FAQ: The new iPhone brings changes to activation, price plans

Apple, AT&T change the game with in-store activation, higher monthly fees

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All that means more time at the store, right? Undoubtedly. Although we've seen claims that the activation will add only 10 to 12 minutes to the process, we think that it's going to take a lot longer than that on July 11, when the iPhone 3G goes on sale.

In fact, we think it'll be a madhouse.

I have an iPhone now, but my original contract hasn't expired. Can I still buy a new iPhone 3G at the $199 (or $299) price? Yes. The contract clock will be reset, so that the two-year contract begins when you buy the new unit. It's not added on to the months that remain on your first-gen iPhone's contract.

I don't have an iPhone now, but I do have an AT&T contract. What's the deal for me? From our reading of the AT&T memo leaked to Gizmodo, it looks like you won't be eligible for the $199 price. "Upgrade eligibility will be determined based on standard upgrade eligibility rules," the memo reads. "Customers must be upgrade-eligible to receive the qualified upgrade pricing. However, not all customers will be qualified upgrades. AT&T has not determined the price of the 3G device for nonqualified upgrades."

Typically, customers of U.S. mobile carriers are eligible for purchase of a new handset at the subsidized price only once every 24 months. So, if you got a new subsidized phone from AT&T, say, in June 2007 and signed a two-year contract at the time, it sounds like you won't be offered the $199/$299 prices.

How much will 3G rate plans cost? About $10 more a month in the U.S. than current iPhone owners pay.

AT&T has said the data component of iPhone 3G plans will run $30 for unlimited access, which is $10 more than the $20 all-you-can-eat data plan sold with the first-generation iPhone. A voice plan is also required; those start at $39.95, putting the minimum consumer monthly plan at $69.95.

Several pundits and bloggers have noted that the increase amounts to an additional $240 over the life of the two-year contract ($10 x 12 = $240), which together with the $199 price of the 8MB iPhone 3G ($240 + $199 = $439), is $40 more than the unsubsidized price of the original iPhone ($399 before they vanished).

Yep. The math checks out. The difference, of course, is that the new phone is ... well, new. If you're in an area that has 3G coverage, the device will be faster in accessing the Internet and downloading than the first-gen phone, which relies on AT&T's pokier EDGE (enhanced data rates for GSM evolution) network.

I haven't heard about text messages. Will an allotment be included with the plan, as was done with the original iPhone? Unlikely.

AT&T's being tight-lipped, officially speaking, but the CEO of the behemoth's wireless division, AT&T Mobility LLC, spilled some beans earlier this week. In an interview posted on GigaOm, Ralph de la Vega said text messages were no longer part of the deal. "The SMS messages are not bundled anymore, and you pay for what you want," de la Vega told Om Malik.


AT&T has several add-on messaging plans, starting at $5/month for 200 messages and climbing to $20/month for unlimited messaging. So to recover the 200 messages provided by the data plan for the original iPhone, you'll have to fork over another fiver each month. What about rates outside the U.S.? Do they have the same kind of deal? Your mileage may vary, as they say. O2 Ltd., the carrier that has the iPhone rights in the U.K., hasn't raised its plan prices (they call them "tariffs") and, in fact, has introduced one that's priced even lower than the original range.

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