Anand Reviews the Apple iPhone 3G
by Anand Lal Shimpi on July 16, 2008 8:00 PM EST- Posted in
- Smartphones
- Mobile
Activation, Price and Costs
I loved activating the old iPhone, you plugged it in, filled out your information and activated using iTunes. Apple, quite effectively, wrestled power away from AT&T. You didn’t have to so much as set foot in an AT&T store to start using your iPhone, it was great.
I was hoping that this was the first step in shifting power away from the service providers. I wanted to see cell phone service providers work much like ISPs, they simply provide you with access to their network and you turn to hardware providers for the hardware. Eventually I’d hoped for silly per-minute charges to go away much like they did in the ISP space and all of it was supposed to start with the symbolic action of Apple wrestling away power from AT&T with the first iPhone.
Then it happened. AT&T subsidized the cost of the new iPhone 3G, allowing Apple to hit its sales numbers and please its investors (as well as increase the install base for the almighty App store) and things went back to normal.
I would rather pay more to be free from AT&T’s grasp and I really hoped that Apple would be the first to change the way cell phones worked after how they handled the original iPhone. But with the iPhone 3G Apple has become no different than any other mobile phone manufacturer. Maybe the long term will still turn out the same or better and this approach will be necessary, I'm by no means a visionary, but what it looks like to me is AT&T wins and Apple and the consumers lose. Its like the struggle between federal government and states rights, and we all just got taxed.
It does look like you’ll be able to buy a no-strings-attached iPhone 3G for $599 or $699 (8GB and 16GB, respectively), but it looks like the days of just buying a phone and activating it on your terms over iTunes are over.
Thanks to AT&T’s subsidies, the 8GB iPhone only costs $199 while the 16GB model will set you back $299. This is significantly lower than the first 4GB iPhone’s $499 launch price. The problem is, as many have already pointed out, that you end up paying more for the new iPhone 3G over the course of your 2-year contract than you did the old iPhone thanks to AT&T’s more expensive data plans:
| Price of Phone | Monthly Cost for 900 Minute Plan | Monthly Cost for Unlimited Data | Monthly Cost for 200 SMSes | Total Cost over 2 Years | |
| iPhone (4GB) | $499 - $100 giftcard | $59.99 | $20 | Included with Dataplan | $2318.76 |
| iPhone 3G (8GB) | $199 | $59.99 | $30 | $5 | $2478.76 |
Let’s take the 900 minute plan that AT&T offers, on the original iPhone and on the iPhone 3G this plan will set you back $59.99 per month (plus all the taxes and added wizard sacrifice fees). Unlimited data used to cost $20 per month, now it costs $30 on the iPhone 3G (that extra G is pricey). You used to get 200 SMSes free with the iPhone data plan, now they cost an additional $5 per month. Even if you bought the first iPhone and didn’t take advantage of the $100 gift card that Apple gave to all early adopters when it dropped the price of the phone, your total cost over two years would be $2418.76 - that’s $60 less than the new iPhone 3G and its subsidized cost.
AT&T subsidizing the cost of the iPhone actually doesn’t do anything to lower your costs over your 2 year contract, it simply means you have to front less money. To make matters worse, you can’t opt for the old iPhone plan with the new iPhone 3G, so even if you wanted to buy a no-contract iPhone 3G you’d end up even worse after 2 years.
The lower up front costs do nothing for you, you’re simply delaying the pain. That being said, these things will sell a lot better than the older ones - while they cost more in the long run, the barrier to entry is a lot lower, and that’s all that matters for most.
Good job Apple, going from the company that had such a hot product that AT&T had to share its monthly revenue, to helping fool consumers into spending more than before. I can’t help but ask what Google would’ve done...
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cocoviper - Thursday, July 17, 2008 - link
Well I think it depends on how we define free. Since you're paying so much for the iPhone's plan one would think they could (or should) include it at some point.The Instinct does turn-by-turn voice GPS and it's included in the phone's plan.
jcal710 - Thursday, July 17, 2008 - link
Anand,You talked about the problems with contact syncing on Exchange. How configurable is it? Does it automatically default to your top level 'Contacts' folder in your Exchange mailbox, or can your point it somewhere else? Do you have the option of choosing whether or not to sync subfolders?
Griswold - Thursday, July 17, 2008 - link
I'm glad I didnt go for the first iphone, that way I can appreciate my 3G more(besides the fact that it wasnt sold until the 11th of july in this country and I would have been forced to import one and jailbreak it).Anand, your friend with the huge lips doesnt listen to the name of S.Tyler by chance? :P
ViRGE - Thursday, July 17, 2008 - link
Anand, do you know if Apple's A-GPS implementation requires cellular network access? Some do, others can revert to traditional GPS operation if there's no cellular network to offer location assistance. I'm curious which of this it isObrut - Thursday, July 17, 2008 - link
So how is it even remotely possible that there hasn’t been a real iPhone competitor in the year since the original’s release?Nokia N95 8GB is far superior to iPhone and it was released even before the first iPhone.
It's right to say there's no competition here. Apple need at least 3-4 more years to be truly competitive to Nokia. I think iPhone is better solution for americans. In Europe you need 3.5G or 4G phone to be truly connected.
michael2k - Thursday, July 17, 2008 - link
You're serious aren't you?Let us count the ways then:
iPhone screen resolution is 2x the Nokia screen resolution
iPhone is nearly half as thick as the Nokia
CPU of nearly twice the speed
The Nokia's one physical advantage is the 5MP cammera (which is only possible because the Nokia is twice as thick).
Obrut - Friday, July 18, 2008 - link
OK, let's count, Michael...1. Screen resolution is bigger and it should be simply because the display is much bigger. The display is much bigger because it's a touchscreen, though not big enough for my fingers.
2. iPhone is thin and that's because it has merely 4 buttons and a low profile, low-end camera. By the way how do you play games without buttons?
3. Speaking of games how do you play OpenGL games? I play Quake 2 with full lighting effects and FSAA at 40 FPS. What about the JAVA games?
4. N95 8GB is a dual CPU solution (2 x ARM 11 @ 332MHz) hence no lower performance here.
5. The 5MP camera of N95 8GB is more that just megapixels - it has Carl Zeiss optics, decent flashlight and can capture movies at 640x480@30FPS. In addition - correct me if I'm wrong but I don't see the front camera which every decent 3G phone has. How can I make a video call with iPhone? After all this is one of the best 3G features.
I can continue counting the battery, office productivity and so on, but this is not the place. I don't want to engage in a Nokia vs. Apple or N9x vs. iPhone battle here. I just don't like statements like "there's no competition", "best phone ever" etc. The most accurate thing to say is that iPhone is the best touchphone to date.
Griswold - Thursday, July 17, 2008 - link
Why talk if you dont know what you're talking about? 3.5G is called HSDPA (an extension to UMTS) in europe, which is supported by the iphone 3G. 4G isnt even available yet, think 2010 for commercial use, so why mention it?Why is there no competition? Because none of the competition has a smartphone that comes with this usability. All the other phones can do the same or more, yes. But all of them feel clumsy like a brick when using them. That is why there is no competition. And this comes from somebody who truly doesnt like apple and its godfather jobs...
cocoviper - Thursday, July 17, 2008 - link
Speaking of not knowing what you're talking about...HSDPA isn't 3.5G, it's definitely AT&T's 3G and that is what the iPhone 3G supports. That's the 3G that Anand complained is not really that much faster.
If there were a "3.5G" in AT&T's portfolio it would be HUPSA (the one that they just upped the offered speeds on.) However AT&T currently doesn't offer any phones that are HUPSA capable. They only have a couple of Aircards for laptops.
And yes, 4G is available in many parts of the world besides the US my friend. WiMax alone is deployed 119 countries currently. LTE is the only 4G that's "not even available yet," and that's because it's yet to be developed. (LTE isn't even into the whitepaper stage yet.)
So don't slam other people especially since there's always someone that will know more than you.
sources -> http://www.roughlydrafted.com/RD/RDM.Tech.Q1.07/93...">http://www.roughlydrafted.com/RD/RDM.Te...A0BF6-62...
http://www.ctia.org/consumer_info/wow/index.cfm/20...">http://www.ctia.org/consumer_info/wow/index.cfm/20...
cocoviper - Thursday, July 17, 2008 - link
*HSUPA not HUPSA :-P