Steve Jobs is an angel!

It has been surreal to watch the negative reaction to the price cut on iPhones, and the reaction to the $ 100 coupon to its early adopters. Not from Wall Street, but from Apple fans!

As I written before it was overpriced, and Apple moved quickly to make it competitive for the market beyond the early fans. It is still overpriced for the mass market both here and abroad, but the reaction to Apple's cut is enough to have Oracle, SAP, IBM and others say - "ungrateful customers will not appreciate more reasonable pricing."

Contrast this to what iPhone consumers are finding with AT&T, as this NY Times article today describes. Hundreds and thousands of dollars in "gotcha" charges.

Here are a few. The base plan at $ 59.99 only covers 450 domestic minutes a month. It does cover lots of night and weekend time and free calling to other AT&T mobile phones. But..God forbid you use it beyond "uninterrupted live dialog between two individuals" - say for conference bridges, its t&c say it can terminate your contract . If you have (or are) a teenager, you might as well sign up for unlimited texting at another $ 20 a month, or pay at 5c a text beyond the base 200. If you travel in the US and want to use its WIFI hotspot network for decent speed beyond its 2.5G mobile network, get ready to pay another $ 19.99 a month. And that does not include most US airports, for which there is a premium.

Overseas, the risks of doing business with AT&T are scary. Your "unlimited data" only applies in the US. Outside you pay roughly $ 25 (after taxes) for every meg downloaded. For that price you might as well buy an "unlimited" international add-on for 20 meg a month. But it is a 12 month commitment and if you travel only 1-2 times a year would not make sense. And only applies in 29 countries. In contrast, there is no global, unlimited voice plan. The "discounted" international roaming plan even after paying a base fee of $ 5.95 a month, still costs you 99c to 4.99 a minute depending on where you are (yes, $ 4.99 a minute - check out rates here. Plus taxes). International WIFI coverage comes in a premium plan of  $ 39.99 a month. If you call 2 total hotspots in all of Argentina and 3 in all of India "coverage".  None in one of the most wired pieces of real estate in the world - Estonia.  So you pay more to hotels or other local hotspots.

And if you decide you want nothing to do with AT&T, they can hit you for a 10% iPhone "restocking" fee. And invoke a $ 175 service cancellation fee for each line.

Steve Jobs cannot openly apologize for his decision to partner with AT&T (well he could but he ain't that naive). He did come close last week. The new $ 299 iPod in particular opens up a "crossover" market with lots of its attractive features but without dependence on AT&T.  With its WIFI access, you can access the internet and use VoIP for calling especially as free hotspots propagate around the world.

The monthly mobile bill is now a source of tremendous anxiety in most households. You have to claw, fight, go to your Congressman every time you get stuck in one of the gotchas (and I am just scratching the surface with examples above).

Compared to that what Steve did - voluntarily - is a class act.

Comments

[Dennis Howlett]

There's got to be a blog site there somewhere is all of this. It's a recurring theme that just won't go away. We have similar problems in EU and the charges look about the same. I have a feeling I'll be leaving my N95 here when I travel to NYC next week.

[Zoli Erdos]

Today there was a thread on TechMeme re. the $3K AT&T bill a guy received, for not switching off email checking on his iPhone before an international trip...

[A Taylor]

AT&T unfortunately was really the only choice that Apple had here in the US for a GSM provider (My Understanding is that T-Mobiles network could not support the I-Phone)

Hopefully AT&T gets its act together or the Apple brand will be hurt by the decision to partner with such a poor example of a customer centric company (AT&T)