“Apple has set of a firestorm of activity in the cellular carrier space,” Mark Reschke writes for T-GAAP. “Apple’s $32 a month iPhone Upgrade Program has carriers in a panic, and for good reason.”
“For $32 a month, a new iPhone 6s can be had now, and every year, the latest and greatest iPhone can be had. All one needs to do is agree to continue the payment program for a 24 month period,” Reschke writes. “The reason carriers are busy countering Apple’s offer is simple. Apple’s program is about to turn carriers into dumb pipes, the likes we have not seen since the original iPhone. Apple uses unlocked iPhones. Thus, anyone signing up with Apple’s iPhone program can join month-to-month carrier programs, and jump ship to whomever they want, whenever they want.”
“Reaction to Apple’s lease program is already taking effect. One carrier allows you to get a new iPhone for $1 a month. Of course, there are all kinds of gotchas in these types programs. The devil, as is typical, lies largely in the details. Carriers are promoting some massive discounts to court users away from Apple’s simple $32/month plan. But the overarching trick is that while Apple’s iPhones are unlocked, the carrier iPhones provided in their discount plans are not,” Reschke writes. “And since this is a lease program, they are not going to unlock the iPhones as they technically own them, not the user. The carriers are pushing the fact many of their plan programs can be quit at any time without penalty, the customer is essentially stuck anyway, because they do not own the phone, the carrier isn’t going to unlock it for them and they are on the hook for the balance of the contract.”
Reschke writes, “The biggest fear for the carriers is millions of users uncovering the gotchas, and moving to Apple’s direct, unlocked, iPhone lease program.”
Read more in the full article here.
MacDailyNews Take: Good. Let ’em panic. We’ve been overpaying for years for these dumb pipes. It’s about time they were forced to compete for the cream of the crop iPhone customers.
Here’s to churn and the frenzied competition it creates! Lower wireless data prices benefit everyone but the dumb pipes. – MacDailyNews Take, September 10, 2015
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