Best Buy to offer Apple's iPhone 3G S with insurance

Posted:
in iPhone edited January 2014
Those who want added protection for their new iPhone 3G S units on launch day will have the option of queuing up at Best Buy to purchase both Apple's device as well as a rare accident insurance plan, albeit one which may cost almost as much as the phone itself.



Best Buy stores nationwide next friday will begin selling the next-generation Apple handset on launch day, albeit at the big-box retailer's usual 10 a.m. opening time instead of the early hours both Apple and AT&T promise.



In contrast to these more direct channels, however, Best Buy plans to continue offering Geek Squad's Black Tie Protection service with the new iPhone, people familiar with the plans say.



While Apple has never offered more than a standard two-year extended AppleCare warranty and AT&T has specifically exempted the iPhone from its insurance offerings, Black Tie covers regular technical problems as well as drops, spills and other failures that would normally require a costly repair service or the purchase of an entirely new device.



Under Best Buy's offering, any instance in which the phone can't be fixed or replaced on the spot will see those customers offered a temporary phone until the repair or replacement is ready within three days or less. Battery replacements aren't as likely due to Apple's sealed-up design, but the company vows anti-lemon protection for devices that have to be brought in four times due defects.



Opting for Black Tie will reportedly still be expensive. For other cellphones, the program costs between $7 and $10 per month depending on the model, but the iPhone's rate rises to $15 per month. That leaves iPhone owners paying about $180 per year -- almost as much as the 16GB iPhone 3G S -- even though those with other expensive phones can pay $120 per year for the same coverage.



Well informed people say the added cost of iPhone protection comes from the heavy subsidies attached to Apple's products. Since the actual, retail price of a phone without a contract is between $599 and $699, it becomes prohibitively expensive to offer Black Tie when customers may use it more than once.



Still, for the accident-prone, Best Buy's Black Tie is currently poised to be the only option for protection of the Apple handset outside of credit card insurance or individually obtained policies. The Black Tie Protection even covers broken screens.
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Comments

  • Reply 1 of 44
    galleygalley Posts: 971member
    Ha ha, that was a good one. For a moment there I thought they said $15 per month.
  • Reply 2 of 44
    Just curious, where is the source stating that BB will have the 3GS on launch day? Haven't heard anything official, even on BB's forums...
  • Reply 3 of 44
    Doesn't the 2 year extended Apple Care plan proved the same type of coverage for just $69?
  • Reply 4 of 44
    Quote:
    Originally Posted by bloodstains View Post


    Doesn't the 2 year extended Apple Care plan proved the same type of coverage for just $69?



    Nope, AppleCare doesn't cover drops, spills or other damage.
  • Reply 5 of 44
    nagrommenagromme Posts: 2,834member
    [/quote]For other cellphones, the program costs between $7 and $10 per month depending on the model, but the iPhone's rate rises to $15 per month.[/quote]



    So iPhone accident insurance costs 1.5x to 2x what insurance on other phones costs? Considering the real unsubsidized price of an iPhone is higher too, that seems pretty good! (~$700 for 16 and ~$800 for 32? do we know the latest full pricing yet?)



    And if other smartphones cost $120/year for insurance while the iPhone's costs 50% more than that, I'd have to know the unsubsidized price of those other phones. Many will be lower, so--paying more is fair enough.



    I prefer just to keep my iPhone OUT of the toilet
  • Reply 6 of 44
    al_bundyal_bundy Posts: 1,525member
    For other cellphones, the program costs between $7 and $10 per month depending on the model, but the iPhone's rate rises to $15 per month.[/quote]



    So iPhone accident insurance costs 1.5x to 2x what insurance on other phones costs? Considering the real unsubsidized price of an iPhone is higher too, that seems pretty good! (~$700 for 16 and ~$800 for 32? do we know the latest full pricing yet?)



    And if other smartphones cost $120/year for insurance while the iPhone's costs 50% more than that, I'd have to know the unsubsidized price of those other phones. Many will be lower, so--paying more is fair enough.



    I prefer just to keep my iPhone OUT of the toilet [/QUOTE]







    most other phones are close to the price of the iphone, best buy is just trying to make some money here because they think people will pay up



    sprint says my work issued Curve 8330 is $570. now please don't hurt yourself laughing at that one
  • Reply 7 of 44
    brucepbrucep Posts: 2,823member
    Quote:
    Originally Posted by Galley View Post


    Ha ha, that was a good one. For a moment there I thought they said $15 per month.



  • Reply 8 of 44
    ihseihse Posts: 4member
    Quote:
    Originally Posted by Galley View Post


    Ha ha, that was a good one. For a moment there I thought they said $15 per month.



    I work for Best Buy Mobile and, while it does seem a lot, you'd be surprised how many people will buy the iPhone from us just because we're the only ones to offer protection against cracked screens and liquid damage. For the accident prone, it's a great plan. We also cover 1-time battery replacement.





    Quote:
    Originally Posted by bluevoid View Post


    Just curious, where is the source stating that BB will have the 3GS on launch day? Haven't heard anything official, even on BB's forums...



    I've received confirmation that we will be launching alongside Apple and AT&T on June 19th.
  • Reply 9 of 44
    cameronjcameronj Posts: 2,357member
    Am I the first to point out that something that costs $180 for a year of coverage isn't "close to" what the iPhone costs, since it costs $499-699?
  • Reply 10 of 44
    ihseihse Posts: 4member
    Quote:
    Originally Posted by al_bundy View Post








    most other phones are close to the price of the iphone, best buy is just trying to make some money here because they think people will pay up



    sprint says my work issued Curve 8330 is $570. now please don't hurt yourself laughing at that one



    Well yeah, Best Buy is in the business to make money - but the iPhone is not cheap to repair. On average, to fix a cracked plastic screen on say, a BlackBerry Curve 8330, it will cost $95. It costs more than twice that to repair the iPhone's glass screen.
  • Reply 11 of 44
    al_bundyal_bundy Posts: 1,525member
    this is 2009, no one repairs anything anymore. you junk it and buy new. labor costs around $50 an hour including taxes and benefits so it doesn't make sense to repair most things.
  • Reply 12 of 44
    alanskyalansky Posts: 235member
    It makes no sense at all to pay $180 a year to insure a device that can be re-purchased for $199 if necessary. So the question is: If you trash your iPhone, will AT&T sell you another one for the same $199 price if you're in the middle of an existing two-year contract? If not, then the insurance possibly makes sense for ham-fisted owners.
  • Reply 13 of 44
    cameronjcameronj Posts: 2,357member
    Quote:
    Originally Posted by alansky View Post


    It makes no sense at all to pay $180 a year to insure a device that can be re-purchased for $199 if necessary. So the question is: If you trash your iPhone, will AT&T sell you another one for the same $199 price if you're in the middle of an existing two-year contract? If not, then the insurance possibly makes sense for ham-fisted owners.



    ATT won't sell you a new one for $199. It will be $599 if you don't manage to keep it for 12 months before damaging it. If you manage to make it 18 months it will be $399. But the kind of people who buy insurance don't take good enough care to have it last that long. I personally don't understand how BB makes money on these deals - I've known several people who should have their picture in the dictionary under "moral hazard" when it comes to these insurance plans.
  • Reply 14 of 44
    cameronjcameronj Posts: 2,357member
    Quote:
    Originally Posted by al_bundy View Post


    this is 2009, no one repairs anything anymore. you junk it and buy new. labor costs around $50 an hour including taxes and benefits so it doesn't make sense to repair most things.



    The customer facing tech people at BB don't make $15 an hour, much less $50. The people who get the phone in the factory to repair it can't make $20 an hour.
  • Reply 15 of 44
    gwarf420gwarf420 Posts: 37member
    Quote:
    Originally Posted by alansky View Post


    It makes no sense at all to pay $180 a year to insure a device that can be re-purchased for $199 if necessary. So the question is: If you trash your iPhone, will AT&T sell you another one for the same $199 price if you're in the middle of an existing two-year contract? If not, then the insurance possibly makes sense for ham-fisted owners.



    They most certainly will not allow you to re-purchase at the new 2 year agreement subsidized cost. Look at all the people complaining that they can't get the subsidized pricing on the iPhone 3G S because they are still under contract on the 3G. It will be full retail unless you are close to the end of your contract, in which case, it may be reduced but not the full new customer price.
  • Reply 16 of 44
    jpoetjpoet Posts: 1member
    Anyone have experience with SquareTrade?



    http://www.squaretrade.com/pages/iphone-landing1





    John
  • Reply 17 of 44
    macxpressmacxpress Posts: 4,712member
    Quote:
    Originally Posted by iHSE View Post


    Well yeah, Best Buy is in the business to make money - but the iPhone is not cheap to repair. On average, to fix a cracked plastic screen on say, a BlackBerry Curve 8330, it will cost $95. It costs more than twice that to repair the iPhone's glass screen.



    Actually you can get a replacement screen for an iPhone 3G for $58.



    Link



    That is...if you wanted to fix it yourself!
  • Reply 18 of 44
    italiankiditaliankid Posts: 279member
    DO NOT BUY THE BEST BUY PLAN...



    I had an iPhone with a loose button and light leak and BEST BUY DENIED the exchange.



    Also, after talking to several associates in the store, they said that if too many exchanges they will deny it and cancel the insurance... Not so great of a plan. Save your money and don't get it.
  • Reply 19 of 44
    Do you know if it is possible to purchase the insurance upfront and prepay rather than putting it on your monthly phone bill? Also, are you getting the 32 GB model?



    Thanks in advance for the information!









    Quote:
    Originally Posted by iHSE View Post


    I work for Best Buy Mobile and, while it does seem a lot, you'd be surprised how many people will buy the iPhone from us just because we're the only ones to offer protection against cracked screens and liquid damage. For the accident prone, it's a great plan. We also cover 1-time battery replacement.









    I've received confirmation that we will be launching alongside Apple and AT&T on June 19th.



  • Reply 20 of 44
    al_bundyal_bundy Posts: 1,525member
    Quote:
    Originally Posted by cameronj View Post


    The customer facing tech people at BB don't make $15 an hour, much less $50. The people who get the phone in the factory to repair it can't make $20 an hour.



    add employee benefits, fica, medicare, unemployment insurance and other costs and that $15 hour salary goes up. i pay $90 an hour labor when i take my car in to the dealer, but i doubt if the guy working on it makes anywhere close to $90 an hour
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