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On iPhone, AT&T/Cingular, Contracts, And Apple
Thursday, January 25th, 2007 at 2:00 PM - by Vern Seward
About 6 months ago I renewed my Cingular contract for 2 years while picking up a RAZR for $20. By the time iPhone comes out I'll be 1 year into my contract and Cingular will be AT&T. I figured I was sunk because I wasn't about to pay full price for an iPhone, which means I would have to wait out my contract to get one.
I spoke with the guy who sold me the contract and he says that, while he couldn't give out details, he was told that AT&T will "work with me" to get me an iPhone when they are available.
He also said that he's been literally swamped with questions and requests for iPhones, and that he knows he could sell 100 a day if he had them now.
That got me thinking about how Cingular/AT&T will handle the iPhone and its customers. They would be silly not to take advantage of this huge opportunity to put a nice shine on the company. Forgiving contracts, creating service packages that people actually will want, and insuring the service is first rate will go a long way towards making them the top cellphone dog.
Screw up and it would take them years to recover the lost revenue and reputation. Why?
Is it June yet? |
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Early iPhone adopters will be very high profile folks. If they can't get a call through, or if the data service sucks they will let more than a few people know about it. Every nuance of contracts and service will be in the public eye. Muck over one semi-high profile iPhone user and it could cost them 1000+ contracts and iPhone sales.
On the other hand, handle new iPhone users with kit gloves and they'll draw new customers by the truck loads.
I also believe that Apple will press AT&T/Cingular to make sure the iPhone is in the best possible light. I would be willing to bet real Wisconsin cheese that somewhere in the agreement between AT&T/Cingular and Apple there's a clause that says something like: "If your service sucks to high heaven we reserve the right to break our exclusivity agreement and take iPhone to other vendors."
I'm sure the opposite is true as well.
So, AT&T could stand to gain. Happy iPhone users would imply that AT&T does, indeed, have good coverage, good service plans, and good customer service, and even if a new customer does not get an iPhone the implied superior service would be assumed to apply to all phones.
AT&T could lose as well. If iPhone turns out to be a dud (doubtful, but you never know), or if it becomes known that any part of their service is not up to snuff not only will they not attract new customers, but they will lose many of their current customers as well.
Of course, Apple is not above missteps, and a screw up with the iPhone could easily kill the current positive momentum they are enjoying, but I'd bet a honey-baked ham that the iPhone won't suck.
By the way; I happen to think that Steve Jobs didn't show all of his iPhone cards during that keynote in San Francisco. We've got 6 months before we see the first iPhone sold and anything can happen during that time.
We Americans have notoriously short attention spans, we tend to focus on whatever is the shiniest bauble at the moment, and I have to believe that Mr. Jobs understands this.
So, while iPhone as introduced at Macworld 2007 is cool, I don't think what we saw was all that there is. I'd be willing to bet my collection of recently minted pennies that the Apple Crew has, or is working on a bevy of peripherals to support this new toy.
Software for working with documents, chatting clients (iChat mobile?), and other apps might be waiting in the wings to be announced at strategic times over the coming months. Also expect to see hardware too. Docks, screens, keyboards, and other cool gadgets from Apple and other vendors as we approach iPhone lift-off.
Finally, expect that there will be enough iPhones to go around. Apple will have a nice long lead time and they can build the phones without FCC approval, they just can't sell them. When it looks close to being a done deal the production lines will kick into high gear.
Back to my discussion with the cellphone guy. When I told him I wanted to possibly get two iPhones (for me and my daughter) he smiled and said, "That's nothing. I had a guy in here a while ago looking to buy an iPhone for every member of his family. Not just his immediate family, EVERY family member. He didn't say how many total, but he had his wife and two teenage kids with him, so that was at least four."
Maybe there won't be enough iPhones to go around after all.
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