AT&T bumps iPhone 3GS price to 99 cents

Posted:
in iPhone edited January 2014
After making the iPhone 3GS free with contract last month, AT&T has now raised the price of Apple's two-year-old smartphone to $0.99.



The iPhone 3GS was originally announced as free with a two-year contract during Apple's iPhone 4S unveiling in October. MacNN reported on Friday that AT&T has now bumped up that price to 99 cents.



"iPhone 3GS is still available at an incredibly low price and we're confident consumers will agree that this remains one of the best deals for a leading smartphone," the company said in a statement.



The second-largest wireless carrier in the U.S. has been the exclusive seller of the iPhone 3GS since it arrived in 2009. Sales of the handset have remained surprisingly brisk even after more than two years on the market. According to the NPD Group, the iPhone 3GS was the second-best-selling smartphone in the U.S. during the third quarter of this year, behind only its successor, the iPhone 4.



The reason for AT&T's minor price hike remains unclear. In the past, Apple has, however, asked its partners not to advertise its products as "free" during promotions in order to prevent its brand from being diluted. It's possible that the iPhone maker had a change of heart about the iPhone 3GS deal and asked for a nominal fee to be put in place.







Another explanation could be the existence of an obscure accounting rule that would require a token payment for the device. For example, Apple in the past had to adjust its accounting of the iPhone to a subscription method in order to steer clear of laws and policies put into place after the Enron scandal. There's no indication that this is the case for the iPhone 3GS, however, and offers of free phones on contract have long been a practice among wireless carriers.



It has also been suggested that the new price is meant to curb overwhelming demand, but it seems unlikely that the extra $1 would deter many prospective customers.
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Comments

  • Reply 1 of 51
    This is the most disgusting thing I've ever seen.



    How stupid could they possibly be? Are they really that desperate for money?



    Zero dollars from Apple. $0.99 from AT&T.
  • Reply 2 of 51
    Quote:
    Originally Posted by Tallest Skil View Post


    This is the most disgusting thing I've ever seen.



    Really? Really?



    Come on though, really?



    There's hyperbole and there's ridiculous, I fear you may have drifted into the latter. It's unquestionably bizarre, pointless & stupid. But disgusting - let alone the most disgusting thing you've ever seen? Come on.
  • Reply 3 of 51
    Quote:
    Originally Posted by Jensonb View Post


    There's hyperbole and there's ridiculous



    Ridiculous is that you took me literally. There's really not much more to say than that.



    Would you be appeased if I amended 'thing' to 'display of blatant money-grubbing'?
  • Reply 4 of 51
    lol to diluting the brand for saying its 'free'



    like a lot of iphones around the world.



    99cents is a waste of time
  • Reply 5 of 51
    2oh12oh1 Posts: 501member
    Quote:
    Originally Posted by Tallest Skil View Post


    This is the most disgusting thing I've ever seen.

    How stupid could they possibly be? Are they really that desperate for money?

    Zero dollars from Apple. $0.99 from AT&T.



    Calm down kiddo. There is obviously a legality involved here. It's probably some obscure thing - who knows what - but considering that AT&T hopes to buy T-Mobile, they're probably being over cautious about something. Think for a moment about how irrelevant that one dollar is in comparison to what they get out of a 2 year contract, especially since most contracts end with the beginning of another lengthy contract.
  • Reply 6 of 51
    Lol, first I thought it said $99!
  • Reply 7 of 51
    misamisa Posts: 827member
    If it's what I think it is, it probably has to do with subsidy accounting.



    In California, you pay the full tax even on "free" stuff. If the device is being accounted as 0.99$ then maybe they've found a loophole. Or maybe they get too many customers asking why their free phone suddenly isn't.



    Tip: Figure out how much the phone really costs AT&T from the tax charged.
  • Reply 8 of 51
    Quote:
    Originally Posted by Misa View Post


    If it's what I think it is, it probably has to do with subsidy accounting.



    In California, you pay the full tax even on "free" stuff. If the device is being accounted as 0.99$ then maybe they've found a loophole. Or maybe they get too many customers asking why their free phone suddenly isn't.



    Tip: Figure out how much the phone really costs AT&T from the tax charged.



    This is the most likely explanation. The Taxman cometh.
  • Reply 9 of 51
    davegeedavegee Posts: 2,765member
    Quote:
    Originally Posted by SpamSandwich View Post


    This is the most likely explanation. The Taxman cometh.



    Yea that was my though as well...
  • Reply 10 of 51
    gatorguygatorguy Posts: 20,287member
    Quote:
    Originally Posted by DaveGee View Post


    Yea that was my though as well...



    It's almost certainly due to this issue:

    http://articles.cnn.com/2011-04-27/u...uling?_s=PM:US



    "A divided Supreme Court gave a big victory Wednesday to business interests, ruling that a cell phone carrier's arbitration clause in contracts that ban larger class-action lawsuits is permissible.



    The 5-4 ruling along ideological lines stopped a claim over whether an AT&T cell phone was falsely advertised as "free." The plaintiffs wanted to bring others into a larger putative class action.



    At issue was whether federal law has sway over-- or "pre-empts"-- state contract laws. Several states have tossed out many class-action barriers by businesses as "unconscionable" and therefore unenforceable."




    Tho dodged by a narrow court victory, by avoiding "free" in the phone pricing it may keep the issue under control. Expect to see the same with ATT's other "free" phones if this is the case.
  • Reply 11 of 51
    tylerk36tylerk36 Posts: 1,037member
    They must have made a mistake at the start. It was free. It still is free at the on line Apple Store. 99 cents. Sounds so stupid to me. What is 99 cents gonna do? Why pay 99 cents when you can get it for free at apple.com. How can apple approve ATT selling it for that?
  • Reply 12 of 51
    gatorguygatorguy Posts: 20,287member
    Quote:
    Originally Posted by tylerk36 View Post


    They must have made a mistake at the start. It was free. It still is free at the on lie Apple Store. 99 cents. Sounds so stupid to me. What is 99 cents gonna do? Why pay 99 cents when you can get it for free at apple.com. How can apple approve ATT selling it for that?



    See the post right above yours. . .
  • Reply 13 of 51
    jd_in_sbjd_in_sb Posts: 1,483member
    Quote:
    Originally Posted by Gatorguy View Post


    It's almost certainly due to this issue:

    http://articles.cnn.com/2011-04-27/u...uling?_s=PM:US



    The primary complaint in that case was the fact that the people were charged full sales tax on a phone that was "free." The full sales tax issue wouldn't go away if the price was changed from free to 99 cents so I am not sure the new 99 cent thing is related to that case.
  • Reply 14 of 51
    jungmarkjungmark Posts: 6,664member
    i was going to get a 3GS for free but now that it's .99, forget about it.
  • Reply 15 of 51
    Quote:
    Originally Posted by Tallest Skil View Post


    This is the most disgusting thing I've ever seen.



    How stupid could they possibly be? Are they really that desperate for money?



    Zero dollars from Apple. $0.99 from AT&T.



    i'm portuguese. how can you buy it at apple's site for free? if i want one, i must pay 350?. 80% of the portuguese workers earn 450 per month.
  • Reply 16 of 51
    I just got this for my wife today. She has a really basic AT&T Non-smartphone that is horrible so this will be a big upgrade for her. With tax I paid $33 plus there is an upgrade charge of $18 that will appear on the bill. She should be very happy to get this.
  • Reply 17 of 51
    Quote:
    Originally Posted by pedromartins View Post


    i'm portuguese. how can you buy it at apple's site for free? if i want one, i must pay 350€. 80% of the portuguese workers earn 450 per month.



    Hello! And the Portuguese equivalent thereof!



    Unfortunately, Apple has yet to release the iPhone 4S in Portugal.



    This means that Apple's old price levels are still in effect on the Portuguese Apple Online Store.



    In the United States and several other countries, the iPhone 3GS is now free. The iPhone 4 costs the old price of the iPhone 3GS. The iPhone 4S, then, costs the old price of the iPhone 4.



    Sadly, you'll have to wait for the iPhone 4S to be released in Portugal to see the iPhone 3GS drop down to being free on contract.



    It would be nice if Apple dropped prices in every store in every country simultaneously (even if the products that caused said price drops hadn't been released yet), but they don't.
  • Reply 18 of 51
    The charge .99 for the same reason they charge $99.99 for iPhone 4 and $199.99 for the iPhone 4s. It's because they are the scum of the earth and can ream you for an extra buck if you're not near an Apple Store. Best Buy also adds an extra 99¢ to all Apple products because they are also scumbags.
  • Reply 19 of 51
    Quote:
    Originally Posted by halhiker View Post


    The charge .99 for the same reason they charge $99.99 for iPhone 4 and $199.99 for the iPhone 4s. It's because they are the scum of the earth and can ream you for an extra buck if you're not near an Apple Store. Best Buy also adds an extra 99¢ to all Apple products because they are also scumbags.



    I'm pissed off. Costing the same price as a bag of Chili-Cheese Fritos. How does Apple expect us to feed our families?
  • Reply 20 of 51
    Quote:
    Originally Posted by halhiker View Post


    The charge .99 for the same reason they charge $99.99 for iPhone 4 and $199.99 for the iPhone 4s. It's because they are the scum of the earth and can ream you for an extra buck if you're not near an Apple Store. Best Buy also adds an extra 99¢ to all Apple products because they are also scumbags.



    Woa there, horsey! Or maybe it has something to do with ruling that Gatorguy mentioned. If not, this sounds a lot like a Sarbanes-Oxley sorta thing they might have to do to protect their asses. Something similar happened when iOS 2.0 came out ? they charged a nominal fee to upgrade.



    And seriously, is a dollar something to get worked up over?? Especially when someone is going to drop around 2 grand to honor the terms of their phone contract?? Geeez, calm down ppl.
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