Thursday, July 10,2008 @ 3:30pm
Piper: Complex pricing may mar iPhone 3G launch
Tomorrow's American launch of the iPhone 3G should be strong, but may be affected by pricing schemes at AT&T, argue analysts with Piper Jaffray. The positive expectations are said to be bolstered a survey of some 200 people, suggesting that Apple has a 3.4 percent share in the US phone market, with the potential for growing to 8 percent within the next year. This, Piper claims, supports its expectations that Apple will sell 45 million iPhones around the world in CY09, with the US forming 30 percent of that total.
A possible obstacle in the launch period, however, is AT&T's pricing schemes. Piper notes that while an 8GB iPhone is advertised for $199, the average entry cost will more likely be $407. This is due in large part to people not eligible for AT&T's subsidized pricing, who may account for as much as 65 percent of current subscribers. There is also the question of activation fees for both new and existing customers.
Many people are in fact confused about 3G pricing, Piper observes. They may thus choose to wait until contracts with earlier carriers expire, or if they are already with AT&T, until they are officially upgrade-eligible. Only price drops over the next 18 months may persuade these people to buy, and compensate for some sales deficiencies in the launch window.