Piper Jaffray says iPhone 3G's real cost to users: $407With a public increasingly puzzled about the actual cost of an iPhone 3G, researchers now see Apple losing some of its early sales to buyers waiting for a less costly upgrade.
The financial firm's senior analyst Gene Munster explains that the multi-tiered iPhone 3G prices, which vary depending on the customer's existing status with AT&T, masks the real cost of entry for many users.
The typical price for an 8GB iPhone is more likely to be a considerably higher $407 based on what most will actually pay, according to the report. That cost is just above the $399 price for non-upgradable AT&T customers and is more than double the $199 price touted by Apple and AT&T in their marketing campaigns — a sticker price which is strictly a "best case scenario" not likely to be seen by many, Munster says.
The often-criticized monthly plan is also said to be a shield for the true cost of owning a phone and may well scare off some customers. Equaling the original iPhone's plans, including the 200 text messages, costs $75 per month, or $15 more per month than what subscribers have to pay for the earlier handset. Even with ideal pricing, an owner of an iPhone 3G ultimately pays $360 more than they would have before over the life of the phone's two-year contract.
A combination of the two pricing woes is predicted to leave many customers left in an unenviable position at launch. The impact of this is could be serious enough to force many customers to wait up to roughly 18 months before making the purchase, no matter how interested they are in Apple's second-generation hardware.
"Buyers will wait until their contract on their current carrier expires, or AT&T subscribers become upgrade eligible," the analyst claims. "As a result, we believe initial iPhone 3G sales will be diluted, but that sales will increase over the next 18 months as the average cost decreases."
Researchers at Piper Jaffray are nonetheless convinced Apple will have little difficulty blossoming its marketshare in the US within as little as a year. Munster cites both a survey of 200 cellphone owners and the potential $1 billion market of the just-launched App Store as factors in growing Apple's command of the US phone market from an estimated 3.4 percent today to approximately 8 percent in mid-2009.
As many as 45 million iPhones are still predicted to ship within all of 2009, he adds.
On Topic: iPhone
- Todoist for iOS gets major upgrades, New York Times creates 'one-sentence stories' for Apple Watch
- Reviewers say Samsung's Galaxy S6 tops Android heap, but S6 Edge is solution in search of problem
- Two-thirds of Apple Pay users running into problems at checkout, survey claims
- Adobe debuts Comp CC for iPad, Facebook Messenger gets third-party hooks, Google Drive enables automatic backups
- Apple embarks on wave of new battery-related job hires, targets iOS improvements