Next-gen iPhone pricing still set, says AT&T CFO

Posted May 25, 2008 at 04:24 PM by Aaron Kraus

Section: Apple, Communications, Cellphones, Cellular Providers, Smartphones, Mobile

AT&T CFO Rick Lindner has let slip a semi-confirmation regarding the arrival of the much anticipated next-generation iPhone.  Widely believed to be announced during Steve Job’s keynote address at the Apple Worldwide Developer Conference (WWDC) on June 9th, the next iPhone is expected to run on the AT&T’s recently upgraded 3G network.  Lindner’s comments regarding the iPhone indicate that pricing has not yet been determined, which leaves the door open to continued rumors of a subsidized version of the device:

“There’s not been a product announcement. There hasn’t been any pricing decision made. That’s yet to come,” he [Lindner] said.

Other popular smartphone devices, including RIM’s Blackberry devices and the Motorola Q are offered on all major networks at reduced prices, in exchange for a long term contract commitment.  Rather than profiting from the device sale, the carrier added packages or services to the plan, including data access and MMS messaging, to recoup the cost of the handset.  At its introduction, the iPhone bucked this convention by offering a full price handset and cheaper, unlimited data packages, a condition set by Apple. 

AT&T has also announced that they are well underway upgrading their network to offer 3G HSDPA and HSUPA capabilities.  Currently 275 markets (a term that AT&T leaves undefined) are served by 3G networks, with a target of 350 served by years end.  These higher-speed transmission protocols mean smartphones will begin to see web browsing and access speeds similar to low-end broadband.  If the iPhone 2.0 does drop at WWDC in two weeks, replete with 3G capabilities, the real question will be: Does the increased speed warrant a changed pricing scheme?  Apple is famous for playing by its own rules for simple pricing, as in the case of the iTunes Store (it’s Apple vs. all major media companies, and so far Apple is winning).  Given that the word ‘iphone’ topped Google’s fastest-rising list for 2007, and 3G iPhone is set to top the 2008 list, Apple has a great deal of leverage at the bargaining table.  AT&T will be looking to recoup the estimated $20 billion they have spent upgrading their network, and the nickel-and-dime package options have worked in the past.  In the end, however, the world will just have to wait until the WWDC keynote on June 9th, when his Steveness will present his loyal fans with all the details.

Via [IntoMobile] Via [Gadgets on the Go]