New iPhones coming next week with contracts, later without

UPDATE: Confused by what the more expensive phone gets you? You're not alone. Here are some answers.

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AT&T said today that it would start selling the speedier versions of Apple's iPhone on July 11, and that at some point in the future people would be able to buy the gadgets without a 2-year service contract for a bunch more money.

The wireless carrier, which for now has exclusive rights to sell the iPhone, said it would charge $599 or $699 (depending on the amount of memory in the phone) for versions of the phone without a contract.

But just because there isn't a contract doesn't mean you will be able to use the phone with service from another carrier, such as Verizon or Sprint. You won't, AT&T spokesman Wes Warnock said.

Presumably the benefit is that you get to pay AT&T by the month, although Warnock said more information wouldn't be forthcoming until the contract-less iPhones get closer to availability. And he wouldn't say when that will be.

A truly "unlocked" phone, usable on other carriers, would have helped defuse tensions between Apple and consumers who tinkered with the previous version of the iPhone to make them work on other networks. Apple had used technology updates to render many of those phone useless.

As announced by Apple Chief Executive Steve Jobs last month, the new iPhone 3G also can be had for $199, for the 8 gigabyte version, and $299, for the 16 gigabyte version, with a 2-year AT&T contract. AT&T is subsidizing the cheaper versions.

AT&T said today that the cheapest contract, a plan for $70 a month, would include 450 minutes of monthly use during weekdays and 5,000 minutes at night and on weekends. The most expensive of the four plans costs $130 for unlimited use. Text messaging will cost from $5 to $20 more per month.

There are a range of activation fees and criteria for discount eligibility, some of which are addressed on an AT&T information page.

Do you think the contract-free iPhone is a good deal or a rip-off? Sound off in the comments below.

-- Joseph Menn

Photo: Apple

Comments

[iNot]

Um....*sniffs*

Sounds like a ripoff to me. But more importantly, it sounds like AT&T is getting a sense that the expected contract market share isn't going to be around after all.

[MV]

I will check with other providers, for sure.....
example:
T-mobile offers $49 per month for 3000 minutes.

Plus others are going to offer smart phones too.

Also apple didn't incorporate some very important upgrades.

I really have to check it out......

Initially, I wanted only iPhone, but now.....I am not sure anymore......

Of course it's a RIPOFF, especially when ATT has the exclusive rights to the phone. This means that even if you buy a contract less phone you can only use it with ATT (unless you unlock the phone at your own risk and go with another GSM network carrier). So if this is the case for you, you are paying an excessive premium to take the phone to another carrier and you run the risk of glitches and malfunctions.

Ideallly, the benefits of having a contract-less phone is to have the freedom to switch carriers at will, the iphone limits this ability and puts the burden on the consumer.

[Angelino]

Of course it's a RIPOFF, especially when ATT has the exclusive rights to the phone. This means that even if you buy a contract less phone you can only use it with ATT (unless you unlock the phone at your own risk and go with another GSM network carrier). So if this is the case for you, you are paying an excessive premium to take the phone to another carrier and you run the risk of glitches and malfunctions.

Ideallly, the benefits of having a contract-less phone is to have the freedom to switch carriers at will, the iphone limits this ability and puts the burden on the consumer.

[MV reply]

MV.. T-mobile does not have a proper 3g network in place. You are going to be waiting a very long time if you decide to go with them for your data plan on a 3g iphone.

[Nathan]

It's a bit much for a device that's still locked to AT&T. If it was $599-699 for an unlocked device that you could use on T-mobile or the foreign carrier of your choice, that wouldn't be a bad deal (cheaper than in Europe where selling unlocked phones is the law, but they charge €999 for an unlocked iPhone). The article, though, shows a lack of understanding of basic mobile phone concepts considering the mention of CDMA carriers like Verizon and Sprint; Apple will probably never produce a CDMA iPhone, and if it bothers, it will be years from now. That has nothing to do with contracts or exclusivity and everything to do with the fact that only a small fraction of the countries in the world have CDMA mobile networks (the notable exceptions being most of the Americas and Korea).

As a satisfied AT&T iPhone customer, who will be upgrading to the new phone on 7/10, I'm not sure what everyone's beef with AT&T is. I find that my coverage is as good as any other network, my rate plan is fairly reasonable - BTW when you're comparing T-Mobile don't forget that their unlimited data plan is $59 vs. $29 on AT&T.

[bizsense]

It's not a ripoff, it's business! Don't get mad at the phone company because they have the idea to sign an exclusive contract. Others have been doing it for years. Quit crying and get with the times!

[Dee]

I'm so surprised at Apple for what they are doing with At&t. I've been a Mac user for years and just love Apple except for the I Phone and ATT. I will not buy one, no matter how cheap, as long as ATT is connected with it.

[Bryan Cook]

i would love to own an iPhone, but refuse to be an AT&T customer. i love verizon and won't get an iPhone until i can use it with verizon.

[Susan]

"I'm not sure what everyone's beef with AT&T is."

Because they commited felonies by spying on us for George Bush without the necessary warrants? I love the iPhone, but want to be able to use Qwest, the only company that didn't conspire with the government to use warrantless surveillance against us, the customers who pay them.

[Werve]

Let me know when the New iPhone starts coming without ATT...

[Eric Chen]

ummm... the writer needs to know that Verizon and Sprint run CDMA networks, and it is technologically impossible for the iPhone to work with such networks as it is a GSM phone...

[Sidnie]

I don't see the point of the contract-less iPhone. If you have to use it with AT&T anyway, what difference does it make if you sign a contract or not. Unless, I guess, you aren't sure you want to stay with the iPhone and AT&T in the future. I don't see anyone with a Blackberry complaining about AT&T.

[get a grip steve]

if steve jobs really wants to dominate the world he would open the iphone up to all carriers. at&t's call quality is terrible and their plans are extremely overpriced.

[San]

I would love to use the iphone however I'd like to use it with Verizon. I choose Verizon over iphone.

[poop]

So what's to stop me from paying $199 + $70 + $175 (to break the contract) for my contract-free iPhone? $450 < $599 :P

[izzy]

I've had an Iphone ever since...and I love it. But I won't get the new one, until the next siginificantly improved model comes out. Like 3g video conferencing. The current new model's difference is not worth it.

[Jack]

It is only in the U.S. they force us to sign the contract and use the phone for a single provider. I must have the felxibility to change the SIM card whenver I want to...
It's rip off end up paying ATT for 2 years without benefiting much out of it...

Most of the US phones wont work when you take them to a foreign country and want to use them temporarily. It doesn't make sense to buy a new cell phone for a 3-week vacation in a foreign country.

[Louis G. Fazzi]

This definitely is a rip off. AT&T has these users right where they want them, charging excessive fees for services one can get elsewhere cheaper. For example, Sprint offers the unlimited phone, text, web etc., the whole ball of wax, for under $100 per month, and I"ve been using pda's and smartphones for at least three years which do everything the Iphone will do. Rip off. Suckers.

[michael william lockhart (Australia)]

I agree with Susan, we here in Australia are suffering the tentacles of AT&T the whole Mobile (called CELL in the US we are told) phone business is a racket, sadly most of our politicians haven't the brains or the guts to do anything about it.

[Liz]

Screw the iphone. SO much hype over nothing. I love my 2 year old Sony Ericsson, and I'm not being paid to say that. It's completely unsustainable to buy a new cell phone every 2 years - and for what? For style, mainly? We are a nation of wasteful consumers and everyone's eagerness to get the newest, hottest piece of technology should disgust more than just me.

[alan]

"i would love to own an iPhone, but refuse to be an AT&T customer. i love verizon and won't get an iPhone until i can use it with verizon."

News flash - Verizon uses the older CDMA network technolgy. at&t and T-Mobile uses the world 's standard for wireless networks - GSM. Apple coming out with a iPhone for Verizon would be like them coming out with a Mac running Windows 3.1.

Apple having at&t as their exclusive partner was a business decision. They could have approached Sprint, Verizon, and the rest of the carriers. But they chose at&t.

[Peter]

How can the people at Apple be so incredible stupid to lock in with 1 carrier!? AT&T no less!!!
I really really want an i-phone and would gladly pay the the big bucks but I'll never get one because I have such a bad taste in my mouth over them trying to manipulate me into signing with such a terrible carrier. I hate people who try and dupe me.
Way to go Steve!! You have some good ideas but this one stinks.
Keep your
I-phone, your I-pod, and your I-diotic ideas.

[Henry]

My recommendation: Do not sign up plans with AT&T.

[Carol]

So if I pay a fortune to NOT have an AT&T contract... but I still can't sign up with any other carrier... what did I pay the $600 for?