The economy is failing, but iPhones, G1s, Blackberry Storms are cheaper than ever
By Triston McIntyre
Sure, your boss is looking over payroll to decide who is expendable, and your 401k took a sickening turn for the worse when Wall Street got greedy, but look on the bright side: all those shiny handsets you’ve lusted after have magically become quite affordable overnight. Is the recent noticeable price drop in flagship cellular devices a generic shift towards increased competition between national carriers, or just the byproduct of a bombed economy?
As much as I’d like to say that U.S. carriers are stimulating competition by engaging in price wars with each other, I sincerely doubt that is the case. Still, it’s hard to ignore the fact that just as recent as last year, flagship devices cost nearly $100 more on each carrier than they do today. Nobody I know is complaining.
The notable starting point of this recent trend of retailing high-end handsets for low prices was the release of the iPhone 3G, which hit the market for $199, significantly lower than the price of the original iPhone. In fact, the iPhone 3G’s debut price was even lower than the price of the iPhone after it was reduced (a move that caused many early iPhone adopters to weep and gnash their teeth uncontrollably).
Then it was off to the races. With Apple’s iPhone holding the undisputed title for most popular cell phone on the market, competitors now had two goals: to match, or at least attempt to match, the creativity of the iPhone, and to set price points that were just as attractive as that of the iPhone.
Just months after the iPhone 3G debuted, each carrier has a flagship touchscreen device that is unique and competitively priced. T-mobile has the Google/HTC brainchild, the G1; Verizon is preparing to debut the Blackberry Storm for $199; Sprint retails the HTC Touch Diamond for $249, and AT&T, as everyone knows, sells the iPhone 3G for $199.
Is the economic downturn forcing carriers to negotiate agreements with manufacturers that result in more attractive price points for consumers? Possibly. Its certainly more believable than thinking that carriers that have long been resistant to change, innovation and competition have suddenly decided to put customers first.
The plus side of all this is that, even when your investments are deteriorating, and America’s banks and auto manufacturers are shutting their doors, you can finally afford that shiny touchscreen handset you’ve always wanted. Don’t ever let it be said that Americans can’t look on the bright side.
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Stumble It!
November 19th, 2008
Apparently you missed the fact that iP3G is heavily subsidized by ATT, and a data plan is required, while the original was neither. THAT is why the price is down and no other reason.
November 19th, 2008
Actually, I didn’t miss that point. The logical reason behind AT&T fronting the large subsidies for the iPhone (and subsequently similar competitor actions) is that the iPhone and other high-end smartphones would be a hard sell for prices like that of the original iPhone. That could be simply that the competition between handset manufacturers has reached the point where carriers need to subsidize much of the cost to stay competitive, or there’s a recognition that the current economic downturn would mean that few consumers, regardless of carriers, are willing to front hundreds upon hundreds of dollars for high-end devices. If the part about the subsidies wasn’t clear to you in the original piece, I apologize.