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AT&T relents on iPhone 3G S upgrade pricing

June 17, 2009 |  2:52 pm
3gs
iPhone users don't want to pay more for the 3G S. Credit: ArabCrunch via Flickr

It was a conflict for some Mac lovers when Apple unveiled its iPhone 3G S this month: drool over the newest gadget, or riot over the fact that they couldn't have it for cheap? Apple and AT&T, it seems, didn't provide a way for existing iPhone 3G users to upgrade to the newest model at a reasonable price. Instead, they'd have to pay $399 while new users pay $199.

Irate iPhone owners blogged, Tweeted and trash-talked, all in an effort to get Apple to stop "ripping us off." More than 4,000 signed an online petition.

The strategy appears to have worked. AT&T said today that customers who are eligible for an upgrade any time between now and the end of September, and who spend at least $99 a month in service fees per phone line, can get the 3G S for the same price as new buyers starting tomorrow online, or Friday at its physical stores.

Previously, only those who had owned their iPhones for 12 to 18 months would have qualified for the "best upgrade price" -- $199 for the 16-gigabyte version or $299 for the 32-gigabyte phone.

If you don't fall into any of those categories, you're out of luck for now. AT&T offers you some not-so-exciting options. You can pay $599 for a 16-gigabyte model or $699 for a 32-gigabyte model without having to sign a two-year contract, or wait until you're eligible for better upgrade pricing.

Don't shoot the messenger, AT&T says, as it's actually losing money by listening to its customers.

"Like most U.S. carriers, we offer a variety of phones that we sell below our actual cost when customers agree to sign service agreements. In general, the more a customer spends with us, the quicker they become eligible for a price break on a new device," the company explained.

Will this be enough to assuage angry early adopters?

-- Alana Semuels

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