Blog Post

New iPhone Pricing and Availability

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

iPhone 3G S

Available today, the iPhone 3G can be purchased on the cheap for just $99. The new iPhone 3G S is available for pre-order via the online Apple Store in four varieties: 16GB in black or white for $199 and 32GB in black or white for $299. Apple has promised that if you pre-order today, it will be shipped directly to you and you will receive it on June 19.

This is the first iPhone model to be available via the online Apple Store web site for pre-order. If you choose to pre-order your iPhone, you can select your rate plan options via Apple’s web site, or log in and see your existing rate plan if you are a current iPhone user. Existing iPhone customers should expect an $18 activation fee and $18 upgrade fee. Then, users can choose to have their iPhone available for pickup at a local Apple Store or shipped directly to their door.

Though I purchased my iPhone 3G on launch day last year, according to AT&T’s records, I will have to wait until early December before I can qualify to upgrade to this iPhone at the advertised rate of $299 for the 32GB. This is different from last year, when Apple and AT&T allowed original iPhone owners to upgrade immediately without requiring owners to pay the higher price. Even though AT&T calls this an “early upgrade,” if you fall within this category, expect the 16GB iPhone to cost $399 and the 32GB iPhone to cost $499.

20 Responses to “New iPhone Pricing and Availability”

  1. AT&T is expecting to make a certain amount of money from your 2 year (3G) contract, that is why apple sold it for less than the original iPhone. So to get another, newer phone at a discount, they no likey!!! I’m just glad they gave money back for the true “loyal” customers who bought the phone in it’s first release for a hefty price…not knowing how it would or would not work.

  2. at Debbie: Did you upgrade from a 1G iphone? If so, then youre still not getting the point. AT&T did NOT pay a subsidy for that phone so they really dont care if you upgrade early. if you upgraded early from another AT&T phone, maybe the subsidy on that phone was less so the upgrade fee was less.

    at biz: agreed, normal practice is pretty awful in general, but if someone wants to know why you cant upgrade early to the 3GS, “normal practice” is the answer, and no one should be surprised by that!

  3. Let’s remember that “normal practice in the cellphone industry” is about a -38 (pick your scale) with respect to acceptable customer service levels for just about any non-monopolistic industry. Hence, the real problem: the AT&T lock-in which penalizes early adopters, customer loyalty, etc. etc. etc. etc.

  4. Debbie Berger

    Well, there IS precedent. When I upgraded to 3G last June or July, I was indeed allowed to upgrade by paying a small fee. I wouldn’t mind if AT&T made me extend my contract two full years. In fact, I am not a bit surprised by AT&T; it is Apple that I am angry with. Everyone out there knows they could have structured this with AT&T (as they did last summer) so existing owners could upgrade as well.

    And, in terms of AT&T, this would have increased business because whoever got MY 3G iPhone (probably one of my kids) would then have signed up with AT&T for service to make it work.

    Did anyone else ever get that $100 on the first iPhone. I asked and emailed repeatedly and could never get it. I know it is too late now, but it is the principal of the thing.

  5. I agree with those here who are pointing out that this is normal practice in the cellphone industry. It sucks from the perspective of the gadget-hungry consumer who wants the latest shinies as soon as they come out (I’m one of them), but the truth of it is that AT&T (or Sprint, or T-Mobile, or Verizon, etc.) are paying the difference on those phones in order to pull in new customers, new contracts, and contract renewals. They can’t afford to subsidize every phone you want every time you want it, and as such, you can only upgrade after the period of time that they set since your last.

    The “early upgrade” is at least a compromise between “we’ll give you this phone super-cheap like the new guys” and “sorry, wait another half a year,” so I’ll suck it up and get it. However, I may have to think twice about upgrading to the next iPhone next year.

    As for #11 April Ferarra, that sounds messed up and wrong. I’d go to a different AT&T store, or call AT&T directly and keep asking about that until you get the right answer. Anyone with a 1st gen iPhone who got it 2 years ago should be able to upgrade to any other phone they offer at this point. That’s just ridiculous.

  6. at #11 April. Since you paid full price , and two years ago, yes you have a legitimate issue (unless of course they let you upgrade in July when your contract actually runs out).

  7. April Ferarra

    I agree with Debbie, I bought an original phone two years ago (July) and I DON’T qualify for an upgrade. To get the phone I want I have to pay $599. It is wrong. I am tired of being a loyal customer (two laptops and two desktops-one being the new 24 inch) and having to use a crappy carrier that drops calls everywhere and now not being able to get the phone at the price of a new customer. It is evident that they just want to capture market share.

  8. kevin

    Echoing #9 Jeff – I’m not sure why people are so surprised. If you buy a subsidized phone you have to wait it out before you’re eligible for another subsidized price. It’s not just iPhones – I got a nokia from at&t the december before the 3G was released and am just now becoming eligible for the upgrade price. If I had decided to go for the 3G at the time, I would have had to pay $200 more than the advertised $199/$299.

  9. To #7 Debbie: Apple did give us a rebate of $100 after they lowered the prices a few months later, is that the “way down” you’re referring to or the 3G pricing? If referring to the first price drop, I find it amazing Apple gave us any rebate at all. Tech prices come down over time. Period. Yeah does it suck that day 1 iphone 1G users paid more? Yeah (I was one of them). But Apple did what any business does, they saw that demand wasn’t there at that price level so they adjusted. It happens all the time. As for the 3G to 3GS, this is what ALL carriers do, I don’t understand why people are so taken aback. This is what AT&T does, Verizon does, everybody. Why? Because the price of the iphone (insert blackberry, whatever) actually didn’t come down as much as you think, AT&T (or Verizon, or whoever PAID part of the price of the phone). That’s how it works. What about all those crappy free phones you can get from AT&T/Verizon, whoever, you think LG/Nokia etc actually make those phones for FREE? No, the carrier PAYS for them. They make up the cost through the length of the service contract. If they kept giving you subsidized phones everyone year, they wouldn’t subsidize in the first place because the would LOSE money. Either that or the plans would be even more expensive then they already are!

    Before I get accused of being an Apple or worse, and AT&T apologist, Im not. I disagree with many of Apple’s pricing vs. feature set choices (although the new 13 inch macbook pros may finally be enough of a price/feature trade off to upgrade my 2 yr+ macbook pro). I CERTAINLY disagree with AT&T’s plan pricing given that 3G is pretty much non-existent in Manhattan, and is the primary reason why I didn’t upgrade. My point is, people shouldn’t be surprised or mad as if this policy is something new or that Apple put it in place. This is not true, this a well known policy for all carriers that has been around forever.

  10. Debbie Berger

    To #6 Jeff: for lots of us it’s not so amusing. I, too paid an unsubsidized price for my 1G phone and was furious when there was never a rebate after prices went way down. Then I bought a 3G phone last October, knowing a newer one would be available this summer but never for a moment thinking Apple would actually screw me twice!! Well, I was wrong, and they did. I certainly will not opt for a new phone now. Sorry Apple, I’d buy the new Sprint phone before I would fall for this scam again.

  11. It’s hilarious to see all these 3Gs owners complainig about not being able to upgrade at the discount price like they *let* original iPhone owners…you know why they did that? Because we paid the FULL UNSUBSIDIZED PRICE for our 1g iPhones! Why do people keep forgetting that!!!???

  12. I have to agree – i got my 3G in December – knowing there would be a new phone in June – but I just couldn’t see why they wouldn’t let existing customers upgrade at a discount – it means tying you in to another 18 month contract. – I’m a UK O2 customer and unlike AT & T they haven’t even suggested that there could be ‘early’ upgrade opportunity – end of your contract just like any other phone and thats that. Very disappointing.

  13. I bought my iPhone in February and even so I’m definitely ready to upgrade. Apple, what do you mean I “can’t”?! Wha…don’t you love me?

    Well that just sucks.

  14. Scott

    I’m truly disappointed in Apple/ATT’s decision to not allow existing 3G users to upgrade to the new 3GS phone for the same price as new users.

    Apple/ATT established the precedent for discounted upgrades for existing users when the 3G came out. They should continue in this tradition and reward loyal customers who want to purchase the phone as it upgrades year after year. Forget the technicalities of the fine print in the contract, just go with your gut on this Apple – it makes sense to reward loyal customers who want to pay you money to get the latest phone model each year when it comes out.

    The bottom line is that this is going to anger a lot of people who will feel, like me, that they are being punished for purchasing the 3G last year. After waiting for months for news of the release of the new phone with excited eagerness, I’m left feeling like a second-rate customer who will consider another smart phone option when my contract expires. So much for the loyalty to existing customers that Apple has normally shown. They’ve turned a die-hard Apple enthusiast into a doubter in one day.