Why the $99 iPhone 3G Changes Everything

iphone3g_sh08Apple just dropped a lot of news on us–new MacBooks with ultra-long battery life; a smarter, faster OS; and new iPhone software and a brand-new iPhone 3G S–but I don’t think anything will have a larger impact than the massive price drop on the iPhone 3G. It instantly changes the game for Apple’s competitors, and it will make devices that are not smart phones nearly irrelevant on AT&T’s network. Just look at AT&T’s lineup right now. As of yesterday, the Nokia E71x was the best $99 smart phone available for the carrier. And while it’s still compelling, a lot of buyers will now gravitate towards the $99 iPhone. Things get even stickier when you look at non-smart phones like the Samsung Impression. Sure, it has a cool OLED touchscreen and a physical keyboard, but $199 now looks like highway robbery. So what about the Palm Pre? $199 is a fair price for the Pre given that the 3G S costs the same, but a lot of people are now going to say I can get the iPhone for $100 less. Same thing goes for other competitors like the T-Mobile G1. $179 no longer seems like a bargain. I still think people will be willing to pay more for a BlackBerry, but don’t be surprised to see a price drop on devices like the Curve 8900 from $149 to $99. The bottom line is that $99 for an iPhone 3G is a breakthrough price point. And it’s officially the biggest competitor to the iPhone 3G S, which should scare the bejeezus out of everyone else.

Mark Spoonauer
Mark Spoonauer
Responsible for the editorial vision for Laptop Mag and Tom's Guide, Mark Spoonauer has been Editor in Chief of LAPTOP since 2003 and has covered technology for nearly 15 years. Mark speaks at key tech industry events and makes regular media appearances on CNBC, Fox and CNN. Mark was previously reviews editor at Mobile Computing, and his work has appeared in Wired, Popular Science and Inc.
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  1. Flubzy Says:

    I see your point in regards to smartphones since they require additional data plans that are pricey. However, non-smartphones shouldn’t hurt that much since iPhone is still an expensive toy when you consider the extra $30 data plan that’s required.

  2. ikkefc3 Says:

    You have to look at the total price over the contract duration I think. You could get it for € 0,- with a contract here and you also could get a HTC Touch Diamond for free with a contract, but for the HTC you had to pay about € 15-20 a month, while for the iPhone 3G you have to pay about 30-35 euro a month (both two year contracts). This is a big difference (€ 360) in total costs, but the phones do cost the same according to your explanation.

  3. Dabbitt353 Says:

    It is my understanding that the $99.00 price is for NEW customers with a 2 year contract only.

  4. Jack Says:

    I agree, because consumers are idiotic sheep.

    The 3G is $99+$150/month.
    The Pre is $199+$100/month.

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