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AT&T to spend $150M on Lumia launch, more than it did with iPhone

post #1 of 84
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In order to help bolster launch sales for Nokia's new Lumia 900 handset, exclusive U.S. carrier AT&T is willing to spend up to $150 million in ad money, more than it spent on Apple's iPhone.

The $99-on-contract Windows Phone, which officially went on sale on Sunday, is seeing heavy investment from AT&T in an attempt to stave off competition from other major carriers that are eroding the telecom's smartphone lead, according to Ad Age.

AT&T, which used $3 billion in advertising money to become the second-largest spender in the country in 2010, declined to comment on the exact Lumia campaign figures, though sources say that the company will put in some $150 million over the coming months.

Smartphones are lucrative products for carriers and generate profit on required voice and data contracts despite high subsidy costs.

"The bulk of the growth for carriers is coming from smartphone subscribers," said Piper Jaffray telecom analyst Chris Larsen. "They generate higher monthly recurring fees and more revenue."

Since losing its iPhone exclusivity in early 2011, AT&T has been ceding ground to other major carriers that now have access to Apple's handset as well as a strong existing base of Android users. For example Verizon, the nation's largest telecom by subscribership, is seeing its already popular Droid brand sales augmented by the iPhone, which was made available on its network about one year ago.

According to market research firm ComScore, before AT&T lost iPhone exclusivity it boasted more than 24.7 million U.S. smartphone subscribers over the age of 13, while Verizon had only 17.8 million. As of February, roughly one year after the iPhone became available on Verizon's network, AT&T's smartphone lead dwindled to only 1.6 million users.

As Verizon closes the smartphone user gap, AT&T is putting its weight behind the Lumia 900 just as it leveraged the iPhone's exclusivity for nearly four years.

The nation's second-largest carrier will run ads in tandem with Nokia, and while there will be some cross-campaign tie-ins, AT&T is expected to market the Lumia 900 as part of its "Rethink Possible" brand.

"We are taking North America and U.S. market very seriously," said Valerie Buckingham, head of marketing for Nokia in North America. "AT&T has a lot running on the success of 900 as well."




To drum up interest, AT&T offered the handset for free as part of a preorder promotion and said the phone will get "prime exposure" at the company's 2,200 stores.

"With our operator partners, we're seeing a lot of support and desire for a third ecosystem," Buckingham said. "We're definitely stepping up to the stage at the investment you need to be successful in this category. You will definitely be seeing this campaign."

Analysts estimate Lumia 900 sales to fall anywhere between 370,000 to 680,000 units with a worse case scenario netting only 140,000 a quarter. In comparison, AT&T activated 9.4 million smartphones in the fourth quarter of 2011 alone, 7.6 million of which were iPhones.

[ View article on AppleInsider ]
post #2 of 84
Interesting move by AT&T. It would seem to me this move is meant to try to draw the Android users away from the other carriers, although I am sure they will take any iPhone defectors with this campaign as well.
post #3 of 84
Ugly phone, and an Ugly interface. If that is their best promotional photos I doubt the device will be a runaway success out of the gate. It might take off IF it works well...
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NoahJ
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post #4 of 84
Fire Sale to follow ....
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Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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post #5 of 84
A couple of people at work have got the Lumia 800 and from the few minutes I've spent playing with one they seem a lot better screwed together than the cheap plastic android crap you tend to get.... seemed pretty fast and responsive and quite a decent phone once you get past the fugly...

The major down side for me is still Windows Phone 7... I really don't get the huge "doesn't all fit on the screen" fonts and there is far too much random sideways scrolling for my liking... both seem very odd UI choices and sadly both seem destined for desktop windows too in Windows 8 and Metro....
post #6 of 84
A carrier would need to heavily promote devices from Nokia, which has lost its luster in recent years, after failing to make the timely course changes after the introduction of both the iPhone & Android. There's should be little doubt that microsoft is heavily subsidizing AT&T's promotion efforts for Nokia as well

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post #7 of 84
This could be a very public, spectacular fail. And if it does fail, Apple is going to gain substantial leverage

This is it for Microsoft and Nokia... Fly or die time

Windows survivor - after a long, epic and painful struggle. Very long AAPL

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post #8 of 84
Quote:
Originally Posted by AppleInsider View Post

In order to help bolster launch sales for Nokia's new Lumia 900 handset, exclusive U.S. carrier AT&T is willing to spend up to $150 million in ad money, more than it spent on Apple's iPhone.

Whatever AT&T spent on promoting the iPhone is a total waste of money. The iPhone sells itself without any need for advertisement.

Now they spend more money to advertise for this than the iPhone should not come as a surprise since they NEED to advertise this product heavily in order to sell it. Not a surprise at all!
post #9 of 84
Wireless advertising is pretty complex. You can bet that for every dollar AT&T spends on Lumia ads that Microsoft and Nokia are agreeing to spend X number of dollars as well. AT&T's budget for the Lumia is not solely based on confidence in the device, but also confidence that dollars spent by Microsoft and Nokia will drive new customers towards AT&T even if they don't ultimately select the Lumia handset.

Apple doesn't do quite the same thing.
post #10 of 84
The real story is that, for AT&T, the iPhone is too successful. People don't buy AT&T anymore, they buy the iPhone (in large part), and the power and profits are shifting to Apple... sure they make more money, but they're desperate to regain the narrative.
post #11 of 84
Quote:
Originally Posted by r00fus View Post

The real story is that, for AT&T, the iPhone is too successful. People don't buy AT&T anymore, they buy the iPhone (in large part), and the power and profits are shifting to Apple... sure they make more money, but they're desperate to regain the narrative.

Exactly. This is about AT&T wanting a competitive marketplace that isn't controlled by one or two players. It also saves them money because the subsidy is likely much less than an iPhone.
post #12 of 84
This thing has two strikes against it - it's running M$ garbage, and it's from Nokia.

Nokia has always built garbage phones, I've used a few back in the day and they were horrible. The only reason they were popular was that they were cheap.

But these days if you want cheap there are plenty of good Android phones out there, and there's the iPhone. M$ is wasting their time even trying, and I'm not sure Windoze phone 7 can even be considered trying, it's THAT bad.

I'm really looking forward to M$ shooting off their own feet with Windoze 8 on the desktop too.
post #13 of 84
Quote:
Originally Posted by Red Oak View Post

This could be a very public, spectacular fail. And if it does fail, Apple is going to gain substantial leverage

This is it for Microsoft and Nokia... Fly or die time

Which means the spin machines will be running 24/7 on overdrive. Lots of money will be flashed at tech bloggers, pundits, analysts, c|net writers, to publish positive reviews and spin the negatives.
post #14 of 84
Quote:
Originally Posted by r00fus View Post

The real story is that, for AT&T, the iPhone is too successful. People don't buy AT&T anymore, they buy the iPhone (in large part), and the power and profits are shifting to Apple... sure they make more money, but they're desperate to regain the narrative.

Quote:
Originally Posted by aaarrrgggh View Post

Exactly. This is about AT&T wanting a competitive marketplace that isn't controlled by one or two players. It also saves them money because the subsidy is likely much less than an iPhone.

What subsidy? Microsoft and Nokia are probably paying AT&T to sell the phone.
post #15 of 84
Lumia 900?

Is that the new Hyundai?

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post #16 of 84
Quote:
Originally Posted by DarkVader View Post

[...] I'm really looking forward to M$ shooting off their own feet with Windoze 8 on the desktop too.

Me too. Windows 8 (desktop) is the answer to a question nobody asked.

Windows 8 on mobile ARM devices actually is an answer to a specific question.
The question is "WTF are you going to do about iPad, Ballmer?"
And boy is Windows 8 on mobile ARM devices a terrible answer.

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post #17 of 84
Quote:
Originally Posted by SockRolid View Post

Lumia 900?

Is that the new Hyundai?

No. It's the top selling phone on amazon.
post #18 of 84
The Lumia 900 looks like an ok phone, to me. I certainly wouldn't buy it, but I can imagine that there would be people who would.

I don't get the whole Windows thing, but, again, I am sure there people who do.

As someone else said, the iPhone sells itself. Nokia and Windows need help. They are trying to jump into a saturated market, one where iOS and Android control somewhere between 80% and 85% of the market already. That's a difficult move.
post #19 of 84
Quote:
Originally Posted by r00fus View Post

The real story is that, for AT&T, the iPhone is too successful. People don't buy AT&T anymore, they buy the iPhone (in large part), and the power and profits are shifting to Apple... sure they make more money, but they're desperate to regain the narrative.

Agreed. The moment AT&T decided to sell the iPhone, they lost their dominant position. It's the same for Verizon. That's one reason why I feel they both try to push alternatives as much as they do. The iPhone is the number one selling phone on EVERY carrier. They have lost control, and want to get some of it back, but it's too late for that. Apple changed the game with the iPhone, and I don't see it changing back.
post #20 of 84
Quote:
Originally Posted by AppleInsider View Post

In order to help bolster launch sales for Nokia's new Lumia 900 handset, exclusive U.S. carrier AT&T is willing to spend up to $150 million in ad money, more than it spent on Apple's iPhone.

I think most of these money came in a form of incentive for a carrier from Microsoft. They already lost count of money they spent promoting WP so extra 150m wont be even noticeable.
post #21 of 84
Quote:
Originally Posted by majjo View Post

Reviews are already out. Anandtech was pretty positive on the phone, and that's probably one of the least-biased tech sites out there.

How long before the posts arrive trashing Anandtech?
post #22 of 84
Quote:
Originally Posted by NoahJ View Post

Ugly phone, and an Ugly interface. If that is their best promotional photos I doubt the device will be a runaway success out of the gate. It might take off IF it works well...

Only a true moron would even think anything good bout that phone.
post #23 of 84
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Originally Posted by Jacksons View Post

No. It's the top selling phone on amazon.

Case closed. Amazon is who brought us the Kindle Fire.
post #24 of 84
.... And a stunning 800x480 display....
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post #25 of 84
Quote:
Originally Posted by NoahJ View Post

Ugly phone, and an Ugly interface. If that is their best promotional photos I doubt the device will be a runaway success out of the gate. It might take off IF it works well...

... and they'll need to spend every penny to move that dog ...
post #26 of 84
get ready to blow taps ... it's over.
post #27 of 84
if it wasn't so fugly… it's just not aesthetically "there" at all…

I'm curious about the "metro" interface though, although it has always felt more a "gimmick" to me than the giant leap it's being promoted as…

It's a visually clever way to present a familiar icon set…. SMS, Calls, eMail, Browser, Photos, etc… but otherwise, what's special or seriously groundbreaking about it?

For the new "lumia 900", I'm sure they'll attract plenty of low-hanging fruit. They're literally giving it away. That should help kick up some initial momentum. But can they sustain it? I'm thinking probably not.. because, in the end, it's still a fugly gadget phone…

And for next year's follow up model? I'm guessing the "Cherry 2000" maybe? :P
post #28 of 84
Nice phone. But, um, it looks like someone took a rolling pin to my daughter's iPod Mini from a few years back.
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post #29 of 84
Quote:
Originally Posted by meeksdigital View Post

.... And a stunning 800x480 display....

It's not a bad resolution but for a 2012 device it's certainly not a flagship caliber PPI.

Worst of all it's the same resolution as the Lumia 800 at 0.6" smaller display at 3.7". I understand why they kept the resolution consistent from a technical standpoint but from a marketing one it doesn't make your product stand out.

Personally I'm a fan of the Nokia HW and WinPh but this campaign doesn't seem to be turning many heads. MS has the benefit of holding off indefinitely refining the platform and waiting for an opening but Nokia may only have a couple years to many things click.

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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post #30 of 84
It's this kind of UI that will keep me away from Win 8
post #31 of 84
MS is late to the party. They should just stick to the enterprise market. I would argue most iPhone users are loyal customers, but what reason would someone have to dump Android for Windows? Is there a compelling software reason to switch?
post #32 of 84
iPhones don't need false praise.
post #33 of 84
Quote:
Originally Posted by Rogifan View Post

MS is late to the party. They should just stick to the enterprise market. I would argue most iPhone users are loyal customers, but what reason would someone have to dump Android for Windows? Is there a compelling software reason to switch?

There is no such thing as the enterprise market anymore. There is only the consumer market which has enveloped what used to be the enterprise market.
post #34 of 84
Quote:
Originally Posted by Rogifan View Post

MS is late to the party. They should just stick to the enterprise market. I would argue most iPhone users are loyal customers, but what reason would someone have to dump Android for Windows? Is there a compelling software reason to switch?

Yes, very late, but they usually are. I can't think of a single market they were first and yet can think of several of them that they ended up dominating for one reason or another.

Apple was also say to be "late to the party" and that "the market was saturated" and "there was no way PC guys are going to come in and figure it out" but they did, and exceedingly fast. As previously noted the benefit MS has is not needing the mobile market the way Nokia does so they can hold out indefinitely waiting for an in. Does it not then behoove them to keep better their product whilst they wait for the opportunity? I think it the smart move.

As for reasons, I can think of security, SW, services, and refinement off the top of my head for switching from Android to WinPh.

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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post #35 of 84
Quote:
Originally Posted by zeromeus View Post

Whatever AT&T spent on promoting the iPhone is a total waste of money. The iPhone sells itself without any need for advertisement.

Now they spend more money to advertise for this than the iPhone should not come as a surprise since they NEED to advertise this product heavily in order to sell it. Not a surprise at all!

I agree completely. Word of mouth sells the iPhone, far beyond the TV spots or print ads. Who in their right mind is talking about the Windows Phone? No one I know.

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post #36 of 84
Quote:
Originally Posted by TNSF View Post

There is no such thing as the enterprise market anymore. There is only the consumer market which has enveloped what used to be the enterprise market.

Then how do you explain how RIM is still around? ........ wait, I think I may have answered my own question.
post #37 of 84
What's up with the bright primary colors?
post #38 of 84
I'd take a Windows phone over the abomination that is called Android. At least Windows mobile isn't just an imitation of iOS. Microsoft is brave enough to try something different. Hate the UI all you want. It's not just a poor copy of iOS.
post #39 of 84
I'd rather have the android.
post #40 of 84
If ATTs service was worthwhile, they wouldn't need exclusive phones and millions in advertising. How about spending 150mil on your network.
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