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iPhone 3G Whiners Should Just Get a Life

iPhone 3GS

Historically, early technology adopters have paid more to get their goodies. Pick a category: Big-screen TV, color TV, Blu-ray player or recorder, car phone, cell phone, digital camera, DVR,  high-speed broadband, MP3 player, VHS player, VHS recorder, Walkman, etc., etc., etc. Early adopters paid a price premium. If they want the newest thing, they pay more.

But with iPhone 3GS, that “pay more” comes at a price hard for some people to accept. Many existing US iPhone 3G owners are whining about not being eligible for discounted iPhone 3GS pricing. I say: Tough luck. You want the newest thing, you’re going to have to pay for it.

First-time iPhone buyers—and the earliest iPhone adopters who didn’t purchase the 3G—are eligible for discounted pricing on the 3GS. They will pay $199 for the 16GB model, or $299 for 32GB. For most iPhone 3G buyers, the price will be $399 and $499, respectively, and still with a two-year contractual commitment to AT&T. These existing customers don’t qualify for the lowest pricing, and many are whining about it.

Get a life. This is how the cell phone business is done. Carriers subsidize the cost of a phone. If the buyer wants the benefit of the discount he or she must agree to some term of service. With AT&T, that’s two years, bud.

The whiners are banding together. At Twitition there is petition:

We the undersigned petition AT&T to offer reasonable iPhone 3GS upgrade prices. AT&T should give existing customers the same rate for the new iPhone 3Gs that they do for new customers. New customers or not, another 2-year contract is being made.

More than 5,500 people have signed the petition. AT&T shouldn’t give into you. Carrier subsidy is a benefit, it’s not a right. You received the benefit when buying the iPhone 3G for $199 or $299 (Apple lowered price to $99 on Monday). The real cost of the device, unsubsidized, is $699 or $799, without contractual commitment or carrier lock in.

AT&T shouldn’t get all the blame here—if any is warranted. Apple launched the original iPhone with no subsidy, sharing revenue with AT&T. Early iPhone adopters like me paid $600, and there was still a two-year contractual commitment. Now that was outrageous. Apple and AT&T charged full price for a phone under contract. The policy had been full price, no commitment.

Because the original iPhone sold unsubsidized, most existing customers were eligible to buy the iPhone 3G starting July 11, 2008. But iPhone 3G’s lower subsidized pricing means that most people have to wait more than a year—as long as 18 months—before becoming eligible for discounted pricing on iPhone 3GS.

Is it unfair? Absolutely not. AT&T doesn’t hide this policy. Just the opposite. The carrier encourages customers to get new phones when they’re eligible, particularly if their two-year contract has expired.

I am one of you. My iPhone 3GS eligibility is July 12, a date that is earlier than expected, since it’s not 18 months since my iPhone 3G purchase. But that does make me ineligible to buy the new smartphone on June 16. Here’s a question: Should any current 3G owner buy up to 3GS? For most people, my answer is no, which is yet another reason for the cry babies to shut up.

The main advantages of 3GS over the 3G model are the less crappy camera and video capabilities. Oh, yeah, supposedly there will be faster 3G data, too. Right, just as Sprint and Verizon roll out 4G services. Sure, there will eventually be applications taking advantage of the video capabilities. Those apps ought to come out in big numbers about the time you whiners are eligible for the full subsidy.

It’s heartening to see that among all the babies calling AT&T a bully, there are a few adults. Over at Technologizer, Harry McCraken writes (I’ve reversed the order of the paragraphs):

I’m not that sympathetic towards iPhone 3G owners who want AT&T to sell them the iPhone 3G S at the same sweetheart price as someone who didn’t buy an iPhone 3G last year. You agreed to fulfill a two-year contract with AT&T in return for the discount you got last year.

If there’s a problem here, it’s the way phones are usually sold in America, via subsidies that encourage us to think that phones cost less than they really do, and which tie us up with a carrier and prevent us from moving a phone we’ve bought to another carrier (even temporarily, when we’re overseas). A top-of-the-line iPhone really costs $699, which is not a crazy price given its capabilities; it’s just that very few of us ever pay that price or even realize it exists. We’re conditioned to think of those subsidized prices as the prices, in part because phone manufacturers and carriers stress them above all else.

God love him, Jesus Diaz isn’t taking any of this whining either. His Gizmodo headline reads “Whiners of the World: Shut Up About the iPhone 3GS’ Upgrade Price.” He writes:

So you bought your heavily subsidised iPhone 3G with a two-year contract and now you are upset because AT&T wants to charge you full price for the new iPhone 3GS, right? Well, stop whining. You have no arguments. I have the iPhone 3G—by the way, I paid an extra $500 deposit on top of the price tag because I didn’t have US credit history back then—and I don’t qualify for a subsidised upgrade. I have to finish my contract first, then renew to qualify for the subsidy. If I was in Spain or anywhere else in the world, it will be the same.

But I am not whining. Not because I am a fanboy—I hate AT&T with a passion—but because there are no logical arguments to support the whining. Sure, it sucks to be me and pay almost-full price for the iPhone 3GS, but that’s how life is. You don’t get a reduced price on your new notebook just because you bought the old model a year ago. You don’t get reduced price on cars, or anything else.

I love these guys. Harry and Jesus are men. They’re taking this like adults. Why aren’t you?

As for me, I figured that if I’ve got to spend big bucks on an unsubsidized phone, why not one that is unlocked and packs better hardware and features. Yesterday I ordered a Nokia N97. The phone should arrive tomorrow. The N97 has a real camera, shoots great video and offers many other features superior to iPhone 3G. Based on using other Nokia handsets, I presume better call quality and battery life will be on the better-than-iPhone list.

Had I decided to buy the cheaper costing iPhone 3GS, I would have quietly waited until July 12. No whining. No complaining. Just anticipation. What’s your problem?

Photo Credit: Kennosuke Yamaguchi

11 Comments

  1. Re your purchase comment –

    I appreciate the higher resolution screen, much much better camera, presumably better call quality, more doubtful about the battery but O.K. let’s give it that too.

    But come on, are you not even going to acknowledge that it has half the RAM, a previous generation CPU and a weaker graphics chip when you say it’s packing better hardware?

    I’m not criticising your purchasing decision, but if you’re not going to highlight the areas where the N97 falls down, then i feel like i must.

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  2. I do actually appreciate the irony there – like i mentioned earlier – i agree and there’s no question that raw hardware performance-wise you get more bang for buck with PCs.

    But let me get this straight – you assert that the mobile phone is / will be “the” personal computing device, but you laugh at me for pointing out factors like processing, memory and graphics that affect everything from camera over web to Ovi apps?

    Again, i’m not criticising your choice of N97, just your statement that the N97 packs better hardware…

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  3. I don’t laugh at you, whatever. Please don’t take it the wrong way. I chuckled because you pointed out something so obvious that I shouldn’t have ignored it. Shame on me.

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  4. Cute, billybob,

    A friend bought my Nokia N96 and the N79 my daughter abandoned for the Nokia E71. If not for the sale of these other cell phones, I wouldn’t buy the N97.

    As for my wife, I offered to let her keep the Mac. Yesterday. Monday’s MacBook Pro announcement brought down price of new aluminum MacBooks.My father-in-law would have paid the extra for a newer Mac. But my wife said, “I want to stay on this track.” Perhaps Window 7 will suit her? We’ll see.

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  5. The real cost of the device, unsubsidized, is $699 or $799, without contractual commitment or carrier lock in.

    This is actually a somewhat arbitrary figure. The cost to Apple to manufacture the iPhone 3GS 32GB model is likely not above $275. Even if you factor in marketing and distribution, it doesn’t add up to close to $799. Apple’s inflating the MSRP, as is AT&T. I don’t oppose companies making a profit, but I do think AT&T’s pricing, for everything from phones to minutes to messaging to data plans, is too damned high relative to other carriers.

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  6. I was explaining this to a group of people the other day, albeit without the succinctness that you did.

    I think the biggest issue is that it’s almost as if iPhone customers (which I am by the way, still using my first gen,) have a certain sense of entitlement, there’s an expectation that Steve Jobs, Apple, AT&T, *whomever* is just going to jump in like an angel investor and hand them free phones (or severely discounted ones at least) every time there’s a new one.

    It’s like going to the car dealership within a year of buying your current vehicle, seeing a newer model, and then demanding that the dealer sell you that one below cost because, after all, you bought one last year. Not only that but it’s not as if you’re trading it in, you’re keeping both.

    I’m still on the fence about upgrading. I was one of the ‘crazy people’ who stood out in line the first day and paid the 600 bucks for the original model, and I guess that fact stuck in my head when the 3G model came out. I didn’t buy it mostly because 3G service where I live sucked at the time, but the fact I’d paid 600 dollars for a phone a year prior was a secondary consideration. A new model out now is great but I can’t help feel like they’ll always be this ‘arms race’ so to speak where I sign into a 2 year agreement and a new shiny phone comes out a year later. I’d rather choose which generation I get and skip the updates in between.

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  7. There’s a big difference with the car analogy, unless the car required a contractual recurring service fee depending on your usage.

    AT&T aren’t making their money off of the handsets they buy, they make it off the service you use. When they charge EXTRA for simply having an iPhone, yet you get nearly the same base service as another AT&T user with a cheaper phone, it seems like there should be something done to keep those higher paying customers happy.

    Subsidizing a couple hundred dollars for the phone to extend the contract out an additional year or two would be well worth it for AT&T, since the premium fees they are charging amount to double or triple the profits easily anyway. It seems this time, to me, AT&T are going too far with their greed factor. Users have no other choice but to pony up for the iPhone experience as AT&T determines it should be.

    Isn’t that more than a little anti-competitive? Shouldn’t there be a friggin choice between carriers to keep these illogical and ridiculous costs in check? Yes, there should be. The government is already intervening, and I’m sure that in the near future we will see something done about it.

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  8. You crack me up, whatever. I didn’t even look at RAM or processor in making my decision. Who really looks at that stuff? But you’re right, that the N97 has a 434MHz processor and iPhone 3GS 600MHz. RAM: 128MB compared to 256MB.

    I see irony in your pointing out RAM and processor differences regarding an Apple product. For years Mac fans have defended Macs for having less processing power and RAM than Windows PCs. It was argued that comparisons didn’t work because Mac OS X had different demands than Windows.

    I’ve used the Nokia N85 and own a N96. Both seem plenty fast enough to me. They’re processors are 369MHz and 264MHz, respectively. The N85 is definitely faster, but I find the N96 still plenty responsive.

    Since you asked for faults, I’m pretty sure N97 is only 3.6Mbps HSDPA, which is half the speed of iPhone 3GS. The data speed is a sacrifice, conceptually; I am using AT&T, so my expectations are low.

    My interest is camera and video as differentiating features that matter to me. Also, telephony. If the N97 doesn’t satisfy, well, Nokia has a 30-day return policy, and I’m eligible for lowest iPhone 3GS subsidy in 32 days. :)

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  9. I’ve set up a few E71s with Mail for Exchange the other day and the hardware ‘feel’ and build quality i found very impressive not to mention the huge slab of a battery.

    How does your daughter like her E71 now? Does she use it for things other than messaging style tasks – IM, twitter, etc?

    Funnily enough after all my Nokia bashing i find myself a (begrudging) Nokia 6300 user as well, now that my iPhone 2G has died… I will never say another bad word about Nokia lest i’m doomed to play snake on a greyscale display if this one breaks too… :)

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  10. My daughter chose the E71 over an iPhone, which she had and abandoned. She wanted:

    * A physical keyboard
    * Full SMS/MMS capability
    * Better camera
    * Video capability
    * Background applications
    * Sturdy phone

    She misses the App Store, but gets that on an iPhone touch. She can carry the E71 in her jeans’ back pocket. She simply loves the keyboard and the attention from other teens about the phone.

    My daughter likes to have IM, Twitter, texting and other apps going at once. Can’t do that on iPhone.

    But she doesn’t find Web browsing to be as good an experience. I agree. The iPhone is better for that.

    Over the weekend, she recorded a video review of the E71. I should have posted it already. So you can hear it from her.

    Reply

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