Comments on: AT&T Roundup: Data Plan Dropping $10? Saturation Nigh? Taking on Staff Pre-WWDC?

By: icebike

icebike — Sat, 09 May 2009 17:35:13 +0000

@miranacake:

makes me think that the a plan would no longer be unlimited

That's a distinct possibility. There are other rumors afoot that Leopard will support 3G directly ( http://www.appleinsider.com/articles/09/05/07/snowleopardtosupportnative3gwirelesswanhardware.html ).

This price drop in the data plan may be a quid pro quo that Apple extracted from ATT for contract extension in an attempt to push notebooks that can stay connected in more places. Other netbooks also have 3G.

So if ATT is dropping 3G prices will it mean that the bandwidth is going to be sucked out of the handheld device market and pumped into roaming net/notebook market?

Caps would certainly be necessary for that to occur.

By: mirandacake

mirandacake — Sat, 09 May 2009 04:35:03 +0000

The price drop story just makes me think that the a plan would no longer be unlimited. Thus, charging overage fees would off set the price drop.

By: icebike

icebike — Fri, 08 May 2009 21:13:41 +0000

I don't buy the "Second" report (link paragraph 3 above). It simply makes no sense to suggest that dropping price of the data plan by 30% would have zero effect on customer growth in this tight economy.

At some price point, everyone will hold their nose and go with AT&T even if they don't like them as a carrier. (The other carriers have their fair share of detractors as well).

At some price point you ditch the Razor Clones, and the cheesy texting specific handsets for something of value that can extend the internet to every corner of the globe.

And at some price point event he cost of the handset ceases to matter all that much. But we aren't there yet. The phone is still too prohibitively expensive and too easily stolen for the bulk of the teenage market.

Simple economic theory says that demand for this device is price elastic. Lower the price (the total cost of ownership) and you will start stealing customers from that smug "Can You Hear Me Now" guy.

This elasticity has never been tested. There is no head-to-head competition for this device in any reasonably sized market.

The theory that this phone is anywhere near saturation when it is the most expensive phone on the market, and has never been tested at any price point other than full price and full data-plan price is simply baseless guess work.

The refurbs sell out rather quickly. But the monthly costs for those remains the same, and many people can't afford that right now.

ATT knows this. Apple Knows this. Press reports of a price reduction may well be a trial balloon story planted by Apple. If ATT drops price, Apple wins. ATT: Not so much.