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Apple's iPhone rebate hypocrisy

updated 08:50 pm EDT, Sat September 8, 2007

iPhone rebate hypocrisy

Apple's decision to credit early iPhone buyers $100 toward the purchase of other Apple products in an attempt to alleviate anger triggered by the massive 33-40 percent price drop enacted just 10 weeks after the device's introduction represents an about-face in the company's stance on such rebates. In fact, in 2003, Apple argued a Microsoft settlement that "fewer than 25 percent of customers redeem these types of vouchers." That criticism concerned Microsoft's $1.1 billion antitrust settlement, which consisted of vouchers worth up to $29. Wired reports "The vouchers, which are still being paid off, could be converted to cash upon proof of purchase of most any computer device or software from any company. Details about Apple's rebate are expected soon. Will Apple issue its own 'vouchers?'"

Apple's concession came after thousands of emails and feedback from angry customers. Backtracking on his previous hard-line stance, CEO Steve Jobs acknowledged the role of early adopters in the evolution of a product, while emphasizing that price continues to decline over the life of any technology product. Customers, he said, could expect a $100 credit some time next week. In an open letter to customers, the CEO reiterated that the company was making the right decision with its price cut ahead of the holiday season, but noted that trust was an important factor in customer relationships.

by MacNN Staff




  1. mherbson

    Joined: Dec 1969


    apples vs. bananas

    Um...there is a slight difference between a settlement offer in response to a court decision and a voluntary rebate. And by "slight" I mean enormous.

  1. Guest

    Joined: Dec 1969


    apples vs. bananas

    Exactly what mherbson said. Sheesh.

  1. davesmall

    Joined: Dec 1969


    Love my iPhone

    I bought a $600 iPhone and I love it.

    Getting a $100 coupon for the Apple store is a bonus and that's OK with me.

    I'm not angry about the price cut. There is no way for us to know what's going on in the background. Did AT&T provoke this? Was the wholesale price the same (I doubt it) or is AT&T subsidizing as they do with other phones.

    Is this a move to clear inventory in preparaton for a 3G model intro?

  1. dliup

    Joined: Dec 1969


    MAJOR difference

    Microsoft: required by LAW to compensate all those unfortunate people who suffered due to Microsoft's illegal anti-competitive practices. Again, it is require by law. Also, those consumers have almost no choice but to spend it on MS software, which cost very little per unit to make.

    Apple: voluntarily gave customers a one hundred dollar freebie, which the customers can actually use to get something THEY WANT such as iPod or other goodies.

    See the difference between MS and Apple's situation?

    When Razr phone first came out it was $500. A few months later the price was dropped to $300. You don't see that company issuing any kind of credit or refund. Razr cost the same as the iPhone! And NO credit on Razr after the price is lowered by 40% (of $500).

    So pay attention, Apple is generously providing a freebie. You are putting conditions on freebies? Get real and stop smoking the funky stuff.

  1. slider

    Joined: Dec 1969



    That's not the same at all. I'd be will to bet that the majority of iPhone purchasers will indeed use their credit, as everyone keeps pointing out, the earliest purchaser has only owned their iPhone for 2 1/2 months, plus as "early adopters", they are more likely to take advantage.

  1. eldarkus

    Joined: Dec 1969



    Wired is so full of s***. Their "blog" postings are done by retards.. Certainly not intelligent journalists by any means... There seems to be a trend in Apple-biased blog reporting coming from Wired. Which is why I stopped going to their site. Go ArsTech!! :D

  1. nhmlco

    Joined: Dec 1969



    Steve also indicated that the iPhone's success is what's letting them order in quantity, which let's them get better pricing, which in turn lets them drop prices.

    It's hard to gauge sales of a new product. Order too many, only to find once it's out that there some major change is needed, and you're screwed. Anyone remember the vast numbers of Performa's that had to be scrapped, all built on the assumption that Sears was going to be a major distribution channel?

    What's going to be interesting is how soon the US market sees a 3G phone. Too soon, and plenty of people are going to be asking just hoe much technology and the market has changed in so short a timeframe.

  1. bloggerblog

    Joined: Dec 1969


    nothing wrong

    I do not see anything wrong with the discount, it happens all the time. I was actually surprised that apple discounted the iphone, but not disappointed. not at all.

    I paid $600 for my iphone and i love it.

  1. e:leaf

    Joined: Dec 1969


    I too

    paid $600 for my iPhone, and I absolutely love it. But being happy with a $600 product doesn't somehow negate the fact that I would rather have paid $400 for it, and would gladly have waited 2.5 months had I any idea that Apple would reduce the price so quickly. To pay a $200 premium for a mere 10 weeks of extra use, and having the priveledge of being a beta tester isn't that great a deal.

    Had Apple not done the "right thing," buying a product the day of release would be a thing of the past with Apple and I. So far, I have purchased the Mac Pro, MacBook Pro, Mac mini, iMac G5, iPhone, and a host of software products within hours of their release. That would have been no more.

    All technology companies rely on early adopters, especially a company like Apple who relies on word-of-mouth advertisement. To s**** them on a regular basis is a really bad idea. Let's hope that Apple doesn't make this a regular habit.

  1. Skanoza

    Joined: Dec 1969


    Holiday season

    A $ 100 voucher during the *holiday season* is bound to see higher than 25% redeeming from customers.

    So this is a decent offer.

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