Spat with Rogers leaves Canadian Apple stores without iPhones

[AppleInsider]

Apple, disgusted with Rogers Wireless for dumping egregious service plans on would-be iPhone 3G buyers, has decided that its Canadian retail stores will have no part in helping the carrier market the new handset to customers, AppleInsider has learned.

As a result, Canadian Apple Retail stores won't be selling the new 3G touchscreen phones come Friday, representatives for the Cupertino-based company said during a private conference call on Monday evening. Instead, it will be up to Rogers and its partner Fido to lock subscribers into steep 3-year contracts that require a minimum monthly payment of $60 for just 150 minutes, 75 text messages, and 400MB of data.

Calls to Canadian Apple retail stores early Tuesday confirmed the move once over. Although the majority of the of stores contacted by AppleInsider said they were still unsure whether they'd be selling the new iPhone, one representative ultimately confirmed that Rogers and its partner stores will be the only place to buy iPhone 3G come Friday. Canadian Apple retail stores will, however, have demo units on hand the same day.

Asked whether the decision not to sell the iPhone was a result of Rogers' poor service offerings, the representative would only say that: "We have nothing to do with the service plans. Those are Rogers' plans."

Word of Apple's abandonment of in-store sales comes just days after the company was reported to have sanctioned Rogers by diverting a significant amount of Canada's iPhone 3G shipments to Europe as initial retribution. As a result, the Canadian carrier will likely receive only about 10 to 20 units per store, and therefore should "exercise caution" not to promise ample stock on launch day, people familiar with the matter have said.

Apple's knee-jerk reaction is believed to have been further stimulated by public outrage on the part of Canadian consumers following the release of the local pricing plans. Always concerned with its image, the iPhone maker has watched nearly 50,000 of its loyal customers sign an anti-Rogers petition at ruinediphone.com, which has in turn sparked hundreds of potentially damaging reports on the matter by bloggers and members of the mainstream media.

For its part, Rogers in official statements has attempted to justify the cost of its service and data plans by arguing that the "majority" of international iPhone carriers have capped data. As such, a spokesperson said Rogers believes its plans to be better than those of Orange France, for example, which include a 500MB 'reasonable use' limit versus the 2GB maximum on the top-tier Canadian iPhone plan that fetches $115 per month.

"Unlimited plans could end up costing customers more for what they don't use," the spokesperson said. "Our iPhone plans more than accommodate the vast majority of customers."

[ View this article at AppleInsider.com ]

[Doxxic]

I don't see why Apple's reaction is being presented as a an act of emotion, power play and punishment.

If Apple expects to sell less iPhones in Canada because of Canada's tarif plans, to customers who will be relatively unsatisfied, it's only natural for Apple to move the first 3G iPhones over to other countries where more will be sold under more positive conditions.

[KindredMac]

Typical greed.

The thing that kills me about all of the cell phone data plans and the broadband prices out there is that they are pretty much making pure profit off of all of these things. It's not like they have to "manufacture and distribute" an actual physical commodity. They just have to make sure that the network is open and up and running.

It would be like me charging someone to get onto my WiFi network at home. Once I covered all my expenses of the hardware and service that I have to pay, it is all profit and I don't have to lift a finger to do anything.... ANYTHING!

[Wiggin]

Originally Posted by Doxxic

I don't see why Apple's reaction is being presented as a an act of power play and punishment.

If Apple expects to sell only a few iPhones in Canada because of Canada's tarif plans, to customers who will be relatively unsatisfied, it's only natural for Apple to move the first 3G iPhones over to other countries where more will be sold under more positive conditions.

If this were just the original report of low initial supplies to Rogers stores, then I might agree with you. But to not be selling them at all in their own Apple Stores? That, I think, is a pretty clear message. Store employees will be explaining to disappointed customers all day long (all weekend long) that they have no iPhones to sell them.

Sure, there is some cold, hard business decisions about were they will sell the most units. But they would have sold at least some, even with Rogers poor service plan options. And Apple loves to have supply shortages and queued up customers waiting for their latest gadgets. It's the best way to get on the evening news for free publicity. Any guess now what the media is going to be saying about the iPhone launch in Canada? Rogers may very well be in for a cold slap in the face.

[ianmac47]

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

[Arneh]

Bell don't seem to have a problem offering decent monthly rates along with unlimited Internet...

http://www.theglobeandmail.com/servl...echnology/home

[applefrenzy]

That's the pot calling the kettle black on the part of Apple. Apple's not offering a full retail unlocked version of the iPhone is just as egregious and anti-consumer as Roger's or any of the other providers' gouging.

[lordeagle]

Originally Posted by ianmac47

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

Fact: the iPhone is a GSM device.
Fact: there is a monopoly in Canada when it comes to GSM cellular providers (Rogers and its Fido subsidiary).

Consequence: even if the iPhone was unlocked, people (in Canada) would still have to go with Rogers. So I'm not sure what your point was.

[AlphaAnt]

Originally Posted by AppleInsider

Apple's knee-jerk reaction...

I don't know if I would call the decision knee-jerk. It's likely coldly calculated and intentional. While Apple is under probably contract to provide Rogers stores with some X amount of devices, it doesn't mean that they have to do anything in their own stores, so this action is as far as they could go to send a message without violating contractual obligations.

[caliminius]

Originally Posted by Doxxic

I don't see why Apple's reaction is being presented as a an act of emotion, power play and punishment.

If Apple expects to sell less iPhones in Canada because of Canada's tarif plans, to customers who will be relatively unsatisfied, it's only natural for Apple to move the first 3G iPhones over to other countries where more will be sold under more positive conditions.

I have to agree. This to me seems like more of Apple's tactics of making itself look good at the expense of its partners. Apple fights the music labels to keep iTunes Store prices the same because it might hurt iTunes sales and then ultimately iPod sales, but Apple plays it off as them standing up against the greedy music execs (and for whatever reason the press laps up Apple's interpretation of events).

If Apple gave a crap about the rates, wouldn't they have put that in the contract with Rogers in the first place (as someone commented about yesterday's story about Apple sanctioning Rogers)? Instead, as you said, Doxxic, Apple realizes that iPhone sales in Canada could easily fall below their initial expectations and thus diverts those units to areas where they are expected to sell with ease. Does it get reported as Apple making a smart business decision? No, it's reported as Apple taking a stand against the greedy cell phone carriers.

[Mr. H]

Originally Posted by KindredMac

Typical greed.

The thing that kills me about all of the cell phone data plans and the broadband prices out there is that they are pretty much making pure profit off of all of these things. It's not like they have to "manufacture and distribute" an actual physical commodity. They just have to make sure that the network is open and up and running.

It would be like me charging someone to get onto my WiFi network at home. Once I covered all my expenses of the hardware and service that I have to pay, it is all profit and I don't have to lift a finger to do anything.... ANYTHING!

As I understand it, Rogers doesn't have much competition in Canada.

Since you think it's so easy, why don't you go and start a mobile network in Canada and start making your easy money?

[Mr Underhill]

has decided that its Canadian retail stores will have no part in helping the carrier market the new handset to customers

And yet they still publish links to both stores. Hmmm...seems like bollocks to me.

[kisin]

Originally Posted by lordeagle

Fact: the iPhone is a GSM device.
Fact: there is a monopoly in Canada when it comes to GSM cellular providers (Rogers and its Fido subsidiary).

Consequence: even if the iPhone was unlocked, people (in Canada) would still have to go with Rogers. So I'm not sure what your point was.

If the iPhone was unlocked you could order it from the Apple Store and pop in your existing SIM card, thus you won´t tie yourself to a nasty multi-year plan...

[charlituna]

Originally Posted by ianmac47

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

there are a lot of phones, smart and regular, that started off as exclusive. some still are. the Sidekick is still just t-Mobile. and the new Instinct is just Sprint. it's really not all that new of a notion. and even the new service plans are more inline with typical smartphone plans.

[iVlad]

greedy greedy greedy

[fraklinc]

Originally Posted by caliminius

I have to agree. This to me seems like more of Apple's tactics of making itself look good at the expense of its partners. Apple fights the music labels to keep iTunes Store prices the same because it might hurt iTunes sales and then ultimately iPod sales, but Apple plays it off as them standing up against the greedy music execs (and for whatever reason the press laps up Apple's interpretation of events).

If Apple gave a crap about the rates, wouldn't they have put that in the contract with Rogers in the first place (as someone commented about yesterday's story about Apple sanctioning Rogers)? Instead, as you said, Doxxic, Apple realizes that iPhone sales in Canada could easily fall below their initial expectations and thus diverts those units to areas where they are expected to sell with ease. Does it get reported as Apple making a smart business decision? No, it's reported as Apple taking a stand against the greedy cell phone carriers.

So now is Apple's fault that Canadians get Abuse by Roger All the time!! Dude in Canada once you sign your life away to Rogers for 3 years, your screw anyway you put it, iPhone or no iPhone, your screw, Even if the iPhone was unlock Canadians had no choice but to go with Rogers, Same applies to the US, Who else in the US has a GSM 3G network, no one but AT&T

[Nobody Special]

Originally Posted by KindredMac

Typical greed.

The thing that kills me about all of the cell phone data plans and the broadband prices out there is that they are pretty much making pure profit off of all of these things. It's not like they have to "manufacture and distribute" an actual physical commodity. They just have to make sure that the network is open and up and running.

It would be like me charging someone to get onto my WiFi network at home. Once I covered all my expenses of the hardware and service that I have to pay, it is all profit and I don't have to lift a finger to do anything.... ANYTHING!

While I'm loath to defend Rogers, you're analogy isn't really accurate. How would you feel if it cost you $1 million to install your home wifi system and your neighbors were using it for free? Creating a 3G cellular network is an investment, not a one-time, line-item expense, and Rogers needs to see a return on their investment. Now, I agree that Rogers seems to be trying to earn an exceptionally large return, but arguing that the marginal cost of adding new subscribers is Roger's only expense is inaccurate.

[zoboomafoo]

Originally Posted by KindredMac

Typical greed.

The thing that kills me about all of the cell phone data plans and the broadband prices out there is that they are pretty much making pure profit off of all of these things. It's not like they have to "manufacture and distribute" an actual physical commodity. They just have to make sure that the network is open and up and running.

It would be like me charging someone to get onto my WiFi network at home. Once I covered all my expenses of the hardware and service that I have to pay, it is all profit and I don't have to lift a finger to do anything.... ANYTHING!

the problem here is that 3G must cover about one percent of all of Canada. There's going to be enormous costs in just supporting the status quo. They will be using a lot of this profit to expand their 3G network and at some point start to support 4G or whatever cool next gen network is coming up.

They will be forever spending money to make money. If there were a case of "why you shouldn't sit back and watch the profit come in", it'd be all the Internet providers out there who are now realizing that Internet traffic seems to be on pace to clog the Internet altogether. Thanks YouTube!

[techno]

Originally Posted by ianmac47

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

That wouldn't help us in Canada. Since Rogers (and Fido by default) are the only Canadian carriers that work on GSM, we would be stuck with them regardless. What would really help is if Apple offered both GSM models and CDMA ones. That way we could have some competition to hopefully drive the prices down. Although, they would probably collude and keep them high.

I miss living in the States in times like these.

[ouragan]

I signed the petition against Rogers and encourage every Canadian to do so.

I sure won't be a Rogers customer for as long as they gauge customers so blatantly.

And yes, I want an unlocked iPhone so that I can choose my carrier (Videotron, Bell Mobility, etc.).

If you haven't signed the petition yet, here it is at http://www.ruinediphone.com/

Thanks, AppleInsider, for the good reporting.

[Virgil-TB2]

Originally Posted by applefrenzy

That's the pot calling the kettle black on the part of Apple. Apple's not offering a full retail unlocked version of the iPhone is just as egregious and anti-consumer as Roger's or any of the other providers' gouging.

True, but there is that exclusivity agreement with AT&T to think about.

I would bet that the original five year term was reduced to two when they changed the profit sharing model last month. The completely unlocked iPhone is likely due next year about this time. Also, in countries outside of the USA, Apple is not getting into exclusivity agreements unless the carrier is offering both revenue sharing and a really good deal for the customers like AT&T did for iPhone 0.9 last year.

Canada is screwed because it's government allowed Rogers to have a monopoly in the first place.

The only other part of the world that is *more* hopelessly screwed than Canada is the Scandinavian countries where a complex series of laws and regulations leave them with a broken and expensive cell system. So again, the government is at fault.

And the only other people in pretty much the same boat as Canada are the New Zealander's, which is hardly surprising since New Zealand and Canada are almost identical politically and culturally.

[wbrasington]

Originally Posted by ianmac47

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

Nominated for dumbest post on the net today.

If Apple really cared, they would give them away free.........

[mark2005]

Originally Posted by Mr. H

As I understand it, Rogers doesn't have much competition in Canada.

Since you think it's so easy, why don't you go and start a mobile network in Canada and start making your easy money?

I agree. It's foolish to compare rates across different countries. The cost of creating a mobile network across all or most of Canada is significantly more than building a network in Hong Kong.

The questions that need to be asked are:
1. Does the carrier's plans for iPhone cost more than plans for other smartphones (data plan required) from that same carrier?
2. Does the carrier's plans for iPhone cost more than plans for smartphones (data plan required) from other carriers in that same country?
2a. If yes, can the cost difference be reasonably accounted for by other factors (better coverage, better service, etc)?

I haven't done the research for Canada, though based on what I've read the answer to both questions is YES. For the US, the answer to both is NO, though on the 2nd question, one carrier (Sprint) does seem to regularly offer cheaper plans.

[NOFEER]

what are the other carriers charging for say blackberry, instinct, etc data and voice plans, how much more is roger's compared to the rest of canada's carriers?

[thisegg]

This poll is to give us a good idea what we are all doing on July 11th.

http://www.thisegg.com/iphone/canadaiphone.html

[sculley]

As someone that was been anxiously awaiting the iPhones arrival in Canada during the past 1.5 years (why I was anxious I don't know, it's a phone!) I am now looking at alternatives to the iphone like a cell phone and an iPod Touch. I'm just not into spending $100 total each month and NOT getting unlimited data. I can live with 150 weekday minutes, but the data cap is a killer. I don't want to have to think about whether I'm over the limit or not. I don't want to count MB's! I was all signed up to buy one the day of release, but not now.

Just curious... what are AT&T's roaming rates in Canada like? It would be funny if I could buy a US iPhone and give my money to AT&T while using the phone and living in Canada for the same price as Rogers is gouging me for. That would be a sweet kick of sand in Rogers face!

[sjenkin3]

Originally Posted by KindredMac

Typical greed.

The thing that kills me about all of the cell phone data plans and the broadband prices out there is that they are pretty much making pure profit off of all of these things. It's not like they have to "manufacture and distribute" an actual physical commodity. They just have to make sure that the network is open and up and running.

It would be like me charging someone to get onto my WiFi network at home. Once I covered all my expenses of the hardware and service that I have to pay, it is all profit and I don't have to lift a finger to do anything.... ANYTHING!

I work in the telecom industry and the capital cost to the providers is very high. New technology in the industry is changing daily and newer, faster networks are being implemented daily. For example most of the main players in the US are moving to 4G (LTE) now. Is this free to implement, no. This equipment is not bought off of the shelf, it is usually modified to the customers needs in their network. And just a rack of equipment cost in the hundreds of thousands. Plus, TELCORDIA requires redundancy so multiply the cost by a minimum of two.

Now, I agree the cost of some these providers is out of line, including AT&T, but to say there is no cost involved is naive.

[ianmac47]

Originally Posted by wbrasington

Nominated for dumbest post on the net today.

If Apple really cared, they would give them away free.........

Fail.

[Charko]

'Rogers' and 'Fido' sound like dogs' names to me.

[chabig]

Originally Posted by kisin

If the iPhone was unlocked you could order it from the Apple Store and pop in your existing SIM card, thus you won´t tie yourself to a nasty multi-year plan...

You'd probably already be on a nasty multi-year plan if you already had a Rogers SIM card!

[ascii]

Apple have played games with iPhone from day 1 by locking it to certain providers, so it's a bit rich to get on their high horse now.

[Sybersport]

Question for everyone:

Is it possible that the Apple Store isn't selling the phones b/c they couldn't come up with a process to sign new customers into a Rogers phone contract?

It seems logical that, since the sign-up process is complicated, the Apple stores in Canada may have not been able to figure out how to make the sign-up process a seamless experience.

Also, maybe this was part of the contract agreement between Rogers and Apple (at least for the first little while?) - if the Apple store sells the phone, Rogers does not get the revenue from the handset sale. I realize that the Apple store will want to sell the handsets, but my guess is that this was possibly part of the launch strategy.

Thoughts?

[mwickens]

What evidence is there that this is Apple punishing Rogers for anything? There's not even any evidence that this selling arrangement wasn't the plan all along.

[newssource]

Whats the deal with people who already have a contract or are on City Fido?

Does the contract have to run out or pay the piper for canceling the contract so that they can buy the iPhone ?

In case of City Fido guys - will not be allowed to get a new phone under subsidy unless they agree to add the $6.96 a month forever.

[Abster2core]

Originally Posted by AppleInsider

As a result, Canadian Apple Retail stores won't be selling the new 3G touchscreen phones come Friday, representatives for the Cupertino-based company said during a private conference call on Monday evening. Instead, it will be up to Rogers and its partner Fido to lock subscribers into steep 3-year contracts that require a minimum monthly payment of $60 for just 150 minutes, 75 text messages, and 400MB of data.

How much of the above, did the, "…representatives for the Cupertino-based company…" say?

I was informed that the Apple Canada Stores were never going to be selling the iPhone. If I remember rightly, the Where to buy iPhone (http://www.apple.com/ca/iphone/buy/) is the same today as it was three weeks ago.

In fact, I set up an appointment to pick up my iPhone for next Friday 3 weeks ago via my local Rogers rep because the iPhone was not being sold in the Apple Retail Store (ARS). Why would I bother to check out my ARS? I have a corporate account and I was inquiring if my corporate discount was applicable.

[wheelhot]

If Apple really cared, they simply would have sold all the iPhones as unlocked devices everywhere, at the same time. The decision to create exclusivity contracts with particular carriers got them into the mess, and now they have to deal with it.

Definitely agree with you

[diazhill]

Originally Posted by Sybersport

Question for everyone:

Is it possible that the Apple Store isn't selling the phones b/c they couldn't come up with a process to sign new customers into a Rogers phone contract?

It seems logical that, since the sign-up process is complicated, the Apple stores in Canada may have not been able to figure out how to make the sign-up process a seamless experience.

Also, maybe this was part of the contract agreement between Rogers and Apple (at least for the first little while?) - if the Apple store sells the phone, Rogers does not get the revenue from the handset sale. I realize that the Apple store will want to sell the handsets, but my guess is that this was possibly part of the launch strategy.

Thoughts?

Agreed. The Apple.ca site has never indicated that iPhones would be available for sale at Apple stores in Canada. When you click on 'Where to Buy', Apple.ca has always referred you to either the Rogers or Fido's websites.

[rbonner]

Originally Posted by wheelhot

Definitely agree with you

How does the unlock help when there is only a single carrier? You still have to purchase services in your local area, locked or unlocked.

In this case, there is only a single player in Canada.

[KindredMac]

Originally Posted by sjenkin3

I work in the telecom industry and the capital cost to the providers is very high. New technology in the industry is changing daily and newer, faster networks are being implemented daily. For example most of the main players in the US are moving to 4G (LTE) now. Is this free to implement, no. This equipment is not bought off of the shelf, it is usually modified to the customers needs in their network. And just a rack of equipment cost in the hundreds of thousands. Plus, TELCORDIA requires redundancy so multiply the cost by a minimum of two.

Now, I agree the cost of some these providers is out of line, including AT&T, but to say there is no cost involved is naive.

Your last sentence is where my "reasoning" is coming from. I, as a consumer who works in a physical commodity industry, cannot see the justness of the prices being placed on a digital "invisible" commodity.

[Plasmali]

Although I am upset and have signed the ruinediphone petition, this statement is probably the most inteligent observation yet of why Apple stores will not be selling the iphone, not some greater plot on Apple's behalf.

Originally Posted by Sybersport

Question for everyone:

Is it possible that the Apple Store isn't selling the phones b/c they couldn't come up with a process to sign new customers into a Rogers phone contract?

It seems logical that, since the sign-up process is complicated, the Apple stores in Canada may have not been able to figure out how to make the sign-up process a seamless experience.

Also, maybe this was part of the contract agreement between Rogers and Apple (at least for the first little while?) - if the Apple store sells the phone, Rogers does not get the revenue from the handset sale. I realize that the Apple store will want to sell the handsets, but my guess is that this was possibly part of the launch strategy.

Thoughts?