How Apple’s new iPhone could quash wireless price hikes

“U.S. wireless carriers are talking about raising prices,” Miriam Gottfried reports for The Wall Street Journal. “But the impending arrival of a new iPhone could be reason to doubt their sincerity.”

“Verizon Communications already raised prices last month, and Sprint and T-Mobile US have stated their willingness to consider the same. AT&T, which hasn’t changed its pricing in almost a year, could also be due for an increase. But price increases in a competitive industry are only sustainable if all players follow through with them,” Gottfried reports. “And if history is any guide, the release of a new iPhone could cause carriers to throw discipline out the window.”

“Many wireless subscribers wait until [Apple’s new iPhone launches in September] to buy a new phone,” Gottfried reports. “Many also switch carriers at the same time, creating an opportunity that T-Mobile, for one, hasn’t been able to pass up.”

Read more in the full article here.

MacDailyNews Take: Ahh, real competition among carriers desperate for the best customers! The iPhone user is firmly in the driver’s seat now!

SEE ALSO:
Analyst: Apple iPhone 7 launch to heat up U.S. carrier competition; downgrades T-Mobile US – June 24, 2016

18 Comments

  1. I clearly recall the rants in this forum about the U.S. government’s decision to block the proposed AT&T acquisition of T-Mobile. T-Mobile then went on to offer great deals and creative plans, stealing away millions of subscribers from Verizon and AT&T, including me. I’m typing this from Europe where T-Mobile offers free 4G data and texts, and 20¢ per minute calls. No question it was the right decision to keep T-Mobile independent.

    1. Yep, I’ll admit it. You were right, and I was wrong. I was in favor of the acquisition.

      I haven’t switched to T-Mobile yet, but if they keep expanding their coverage like they have been, I’m likely to switch soon for my iPhone. I already their free plan on my iPad Pro, and have been pretty pleased with the results so far.

      1. So not everything the Government does ends in disaster. Sometimes regulations and oversight are a good thing, and consumers benefit. No doubt had this deal gone thru, the only people to make more money would have been the head of ATT wireless, and not consumers. Now, WE win.. and HE (or she) looses….

        1. So what you are saying is the the govt. should force Apple to license their ecosystem to other players?

          After all, Apple’s margins of ~38% on a handset are truly obscene, and NOT in the interest of the consumer.

          Using your logic, the govt should ‘force it’ and we the consumer would get a much wider handset choice on iOS and lower prices due to hardware competition.

          Be careful what you wish for.

    2. In free-market economies, as in a free society, the price of freedom is eternal vigilance. That is the role of the US’s Department of Justice antitrust division. Note to right-wing idealogues: there is no Invisible Hand magically making things fair. If there is no government oversight, whether on Main Street or Wall Street, the biggest bully always wins.

        1. But, _if_ the government is representative of the people, it is _our_ bully. In other words, it should take actions that lead to the greatest benefit for the most people, as opposed to the shareholders of a single corporation.

          Note that I said “_if the government is representative” – that’s a very important thing to guard, and arguably many countries – including the U.S. – haven’t done a very good job of that.

          1. Yes, the govt is not representative at all of we the people. Just look at how the ball-less Comey let Hildebeast off the hook for crimes that you & I would be sitting in prison for…

  2. The breakup fee gave T-Mo the flexibility to disrupt the other carriers. John Legere had the “nads” to make it happen. Looking forward to their next move.

  3. I’m an expat living in Russia, and the competition among carriers here is fairly intense. I pay under $21/ month for 4 devices, 10GB/device, 400 min on each of the phones, and a couple hundred SMS.

    I’m thinking about going back to the US in the next year, and looking at a wireless bill nearly 10x what I pay now.

    1. Expat,

      As someone who’s travelled & done business in Russia for years, let me ask you a couple of questions… 400 minutes? Really?? Here we have UNLIMITED VOICE MINUTES and a couple hundred texts??? We have UNLIMITED TEXTS (although most of mine go through iMessage.)

      You are also comparing prices in a Second World country with a drastically lower average income, therefore ability to pay by the customer is dramatically lower.

      It is also a country where the top <1% live like billionaire Manhattanites, while the rest of the country struggles to eat at McDonalds. (and is Third World once you get outside Moscow or St Pete's)

  4. Regulation has benefitted most American cell phone customers far more than most realize.

    In addition to the competition that ensued after the FCC and DoJ blocked AT&Ts purchase of T-Mobile, the universal service fund has subsidized the provision of cell services in underpopulated and remote areas by making it financially viable. The irony is that the majority of the rural areas that benefit most from this program fancy themselves as free market Conservatives- people politically opposed to such actions by government.

    Also, about 10% of President Obama’s stimulus package was used to fund the broad expansion of high speed internet service to rural America. This benefitted again many people who view themselves as free market Conservatives who mostly opposed the stimulus. The subsidy allowed telecomm companies and ISPs to expand the capacity of their lines to small communities which greatly improved rural broadband availability and extended the reach of 4G LTE service. Without the stimulus, many of these areas would be limited to dial-up, maybe DSL and 3G wireless.

    The government has a legitimate place in commerce as is specified in the Constitution. Ruinous competition can destroy industries and monopoly can destroy consumer choice, the advance of technology and our wallets.

    1. You contention about these poor rural areas as “Conservative” has been DEBUNKED. Another fallacious DNC talking point for the uninformed.

      Just look at an election results map. Most of these voting districts in Conservative states, vote DemocRAT… Duh!

    1. If you believe this, then the govt. should be regulating APPLE!

      Apple’s profits are greedy by any measure. So what you are saying is the govt. should force Apple to open their ecosystem to other hardware players by licensing it out to drive down the price of the handset…

      Correct?

Add Your Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.