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China Unicom offers free iPhone 4S on contract
Want a free iPhone 4S? If you're a customer of China Unicom, you're in luck -- the company announced today (one week from the first day of iPhone 4S availability in China and 21 other countries) that they'll give users a free iPhone 4S for signing a multiyear service contract. It gets better. The promotion offers the 32 GB iPhone 4S on a three-year contract for as little as 286 yuan (about US$45) per month, or customers can commit for only two years and get the 16 GB model for 386 yuan per month. Several industry analysts think that the subsidy, which is designed to attract high-end subscribers who will also buy up expensive data plans, is a bad idea for China Unicom. Hong Kong-based analyst Steven Liu of Standard Chartered Bank noted in a Bloomberg article that "After subsidizing the iPhone, the operator will have less money for subsidizing other smartphone users that could be more profitable." China Unicom's costs for 3G phone subsidies and related marketing expenses were nearly 6 billion yuan in the first half of 2011, almost four times the same period in 2010. The popular iPhone handsets are sure to hit the carrier's subsidy costs even more, but customers don't appear to want to purchase lower priced and less capable smartphones.
Telus makes it simple to terminate contracts, replace your feature phone
Taking a page from its own playbook, Telus Mobility has extended its Clear and Simple Device Upgrade program to the logical conclusion of contract termination. Now, if a customer chooses to cancel their service, they must pay only a $50 administrative fee and the remaining portion of their phone's subsidy -- it could still result in a lot of loonies, but the amount decreases monthly according to a fixed schedule. Similar to Rogers, Telus offers its customers early upgrades by allowing them to pay this unrecovered subsidy and commit to a new contract. To make the process even easier (and more tempting), the carrier is now including this magical number with its monthly bills. So, as you dream of getting cozy with a new Nexus S or Optimus Black -- or ditching the Telus network -- just follow the break for the PR.
Rogers Canada offers 'early upgrade' for your horribly outdated phone
Long term relationships can be hard. After a year or two, it's easy to lose interest -- but a contract's a contract, right? Not in Canada, apparently. Wireless carrier Rogers is offering a get out of jail early card, letting you get some new hardware before the end of your contract with its new "early upgrade" offer. But if you want, say, the Xperia Play pictured above, ditching your antiquated handset will cost you, naturally. The service provider has a tiered pricing plan, charging a different level depending on the device and the amount of months that you've got left -- something of an early termination fee for those who don't mind sticking with the carrier. If math isn't your thing, Rogers recommends you pop by one of its retail locations to help you figure out just how much it'll run you. In the meantime, try to avoid hurling the thing out a window in disgust, okay?
CE-Oh no he didn't!: BMW exec says electric vehicles 'won't work,' but would love to sell you one anyway
Jim O'Donnell, CEO and chairman of BMW North America, recently sat down with the Detroit News to discuss the ActiveE -- an electric version of BMW's 1 Series coupe, available for lease in the US this fall. Most CEOs would've probably used the opportunity to wax PR poetic about their company's bold, forward-looking ethos, because that's what CEOs do. O'Donnell, however, used the occasion to let us in on a dirty little secret: EVs don't actually work. According to O'Donnell's undoubtedly robust calculations, EVs won't work for "at least 90-percent" of the human population, at current battery ranges. The situation is so dire, in fact, that the US government shouldn't even bother wasting its $7,500 tax credits on frivolous things like innovation, national security and clean air. "I believe in a free economy. I think we should abolish all tax credits. What they are doing is putting a bet on technology, which is not appropriate. As a taxpayer, I am not sure this is the right way to go." O'Donnell went on to say he's "far more optimistic" about diesel's chances of increasing BMW's US market share -- because, you know, it's not like the oil industry gets any tax breaks, or anything. And it's not like diverting some money away from oil subsidies and putting it toward EV technology would create the "level playing field" that O'Donnell and his company so desperately need. No siree, the US energy market is just as pure and fair as it's always been -- and it certainly doesn't deserve to be corrupted by an EV tax credit pestilence. That said, O'Donnell would still really appreciate it if we buy the battery-powered i3 when it launches in 2013. Who knows? He may even throw in a free bridge, too.
T-Mobile expected to cut Galaxy Tab pricing to $249.99 (update: drop is official!)
After initiating the first on-contract Galaxy Tab price cascade back in December that quickly led Sprint to respond, T-Mobile may chop subsidy prices again today for the 7-inch tablet to just under $250 (after a pesky $50 mail-in rebate). Together, that's only $62 more than the bargain bin CherryPad, which should infuriate early adopters who paid double that only a few months ago, not to mention sober up Samsung. However, when you consider that pseudo-4G tablets like the Dell Streak 7 and LG G-Slate will join Magenta's lineup soon, it is a viable strategy for extending the Tab's consumer appeal in this viciously competitive Android tablet world we live in. Then again, if the dual-core processors teased for the Tab's successor actually pan out, we doubt Samsung will need any assistance getting back to its smug position on top of the Android heap. We'll be keeping our eyes peeled on T-Mobile's site today and be sure to update should the price change actually materialize. Update: A recent peek at T-Mobile's site shows the price drop is now official. If you're in the UK and prefer buying the Tab unsubsidized, Amazon and Tesco have also chopped their prices to a palatable £341.24 ($542) and £359.20 ($571), respectively. Thanks, Raphael and Rupert!
UK aims to improve access to technology, internet with £98 Linux PCs
Remember when the UK started distributing free laptops to poor schoolchildren in order to encourage them to get online? Well, a new, more frugal government is now in charge, and while the original scheme has been scrapped, today we're hearing of alternative plans to help economically disadvantaged people leap onto the worldwide surfer's web. The coalition government intends to offer £98 ($156) computers -- which include an LCD monitor, keyboard, mouse, warranty, and a dedicated helpline -- paired with subsidized £9 ($14) per month internet connections in its effort to show that the web doesn't have to seem (or be) unaffordable. The cheapest machines will be refurbished units running open-source Linux distros, meaning that if this Race Online 2012 trial turns out well, we could see a whole new group of Linux loyalists rising up. The more the merrier!
iPad 3G available for free in Japan with two-year Softbank contract
Japan's Softbank Mobile is subsidizing the entire cost of a 16GB iPad 3G (translated link) for those willing to sign a contract for two years of monthly data plan payments. By agreeing to pay Softbank $56 (¥4,725) a month at least 24 times, customers get the iPad for free -- sort of. The way the plan is structured, the monthly payments are actually split evenly between the unlimited data plan and payments on the device. One of the many upsides to buying an iPad is that, even if you opt for the 3G version, you don't have to get locked into another two-year AT&T contract. On the other hand, that means you'll have to pay Apple's full list price to get one. Japanese customers now have an option to get a 16GB iPad 3G for no up front cost, but they'll give up a lot of freedom by doing so. [via Engadget]
TiVo Premiere now free on contract for $20 monthly, as TiVo introduces (and enforces) tiered subsidies
Well, it seems we finally know why TiVo was waxing poetic about software in recent months -- it's the way the company primarily plans to charge for its DVR hardware from now on. Following a week-long experiment of free-on-contract DVRs conducted last month, TiVo's opening up subsidized and partially subsidized pricing tiers to the entire US for those willing to chain themselves to a pricier $20 monthly fee. You can now get a TiVo Premiere for $0 on a two-year contract or $100 with a one-year arrangement, or pick up a TiVo Premiere XL for $300 on a one-year deal -- the same price the regular old 45-hour TiVo Premiere cost originally. TiVo's also kept the original $12.95-a-month plans around in case you want to pay full price for your hardware, which would normally make better financial sense after about three years, if not for the fact that there are still lifetime subscriptions available for $400 if you're truly in it for the long haul. We're all for expanding our buying power in this arena, but there's one group of customers who are liable to get mighty pissed at the new arrangement -- the regular Joes and Janes headed to Best Buy right now to pick up a $99 TiVo Premiere "on sale." You see, retailers apparently didn't get the memo about the new tiered pricing and are advertising the arrangement as a $200 discount instead, which leaves TiVo's fine print the unenviable role of explaining that they're going to pony up $20 a month from now on. 2.1.2 When purchasing a TiVo Premiere box from a third party retailer at $99.99 (includes an instant $200 savings off MSRP) for the TiVo Premiere box or $299.99 (includes an instant $200 savings off MSRP) for the TiVo Premiere XL box, you may only subscribe to the TiVo Service on a monthly basis for $19.99 a month with a one (1) year commitment (renews monthly after one year). Choices, choices. [Thanks, Daniel and Chris R.]
Schmidt says Chrome OS devices will be 'disposable,' priced like netbooks
You might have heard Google's Chrome OS will live entirely in the cloud, and that devices running the web-based platform will automatically back up your data on remote servers. You might think it will keep your private details safe -- as safe as anything else you trust Google to store, that is. But had you ever considered what the cloud meant for the hardware running it? CEO Eric Schmidt has. This week, he told the Atmosphere Cloud Computing Summit that Chrome OS devices will be "completely disposable" at netbook-esque price points of between $300 and $400. That's pocket change for a large IT department perhaps, but we can't imagine tossing even the cheapest Eee PC in our dustbin. How about subsidized, though? Asked whether Google might give away devices on contract, Schmidt said "Sure," adding afterwards only that his company doesn't see itself selling the data plans. We wonder what that means for the thousands of enthusiastic towns now praying for Google fiber. Hear Google's CEO for yourself after the break; info in question begins 13:33.
NTT DoCoMo posts 41% profit increase on reduced handset subsidies
Go 'head with your bad self, NTT DoCoMo. Party on down 'til six in the morning, because you just posted a quarterly profit increase of 41%. What's to thank for such a remarkable boost? According to a Bloomberg report, the outfit's decision to "reduce handset subsidies to customers" enabled it to bring in more cash despite the fact that sales fell 1.1% in the same quarter. President Ryuji Yamada proclaimed that the "acceptance of the monthly handset payment plan by our users helped bolster profits in the quarter," and he also highlighted a "considerable decline in the cancellation ratio." Still, some analysts are uncertain if the telecom company can maintain the growth, with Deutsche Bank AG's Kenji Nishimura stating that the "increase in profit was merely caused by the change in the accounting." Snap DoCoMo, are you just going to take that?[Via mocoNews, image courtesy of Flickr]
Unsubsidized iPhone prices
Stories about cell phone unlocking and resales have hit the news recently. TracFone sued numerous resellers who (legally) bought inexpensive subsidized units, unlocked them and sold them overseas. In the iPhone world, the story differs. Rather than leveraging subsidized prices, the way the TracFone defendants did, iPhone resellers added value on top of the unsubsidized units. They bought the phones, unlocked them and sold them for a profit. The story gets more interesting with the current generation "no commitment" iPhones. The latest 3G "no commitment" iPhone pricing appears to include an extra $200 profit margin on top of the $200 subsidy. TUAW reader Adam Jenkins offers proof. In Massachusetts, purchasers pay tax on the full unsubsidized phone price, regardless of carrier subsidies. The 5% sales tax for his new 16GB 3G iPhone came to $24.95. Clearly, Apple and the State of Massachusetts believe the unsubsidized 16GB price is $499, not the $699 "no commitment" price. That extra $200 offers a nice cushion on top of the unsubsidized sale, providing pure profit. What's the opposite story of resellers taking advantage of cell phone subsidies? Seems to be the 3G iPhone.
Doin' the wacky AT&T math
As everyone has told us this morning (Thank you guys, we love you!), AT&T has announced their price plans. Christina got a post up about this earlier today. As I dragged my weary Mountain-Time-based self out of bed (after a night of random fire alarms due to a wonky 9-volt battery), I decided to see what all the fuss was about. You can imagine my surprise when I saw that AT&T was slapping a $400 premium onto non-contract phones. In case you were up most of last night (like I was) and weren't reading that last line correctly, let me say that again: there is a four hundred freaking dollar premium for non-contract phones. Follow the jump for more thoughts about this development.
iPhone 3G may be sold unsubsidized
Will the iPhone be sold unsubsidized? That's the conclusion I'm coming to as I read between the lines of this AT&T Memo to Retail Managers. The money quote is this: "However, not all customers will be qualified upgrades. AT&T has not determined the price of the 3G device for non-qualified upgrades." If I'm reading this right, AT&T will sell off-contract iPhones at a yet-unspecified price. If true, this is terrific news for anyone who wants to hack their iPhone and not be bound to an AT&T contract. It's also fabulous news for anyone who wants to upgrade to a new iPhone but doesn't live in a 3G-serviced area. If historical prices are any indicator, off-contract phones could sell for a few hundred dollars above the subsidized price. At the very least, according to this memo, you can sign up for a contract, get the iPhone and cancel after 30 days, paying the early termination fee. After that, the iPhone is yours free and clear. I am not a big fan of this option as I do not like signing contracts that I do not intend to keep. Regardless, this is (a) legal; and (b) in compliance with contract terms. Thanks, Ethan Hixson.TUAW reader Rawheadz writes: "The money quote is that you DON'T have to return the phone after the 30-day return period, so long as you pay the early termination fee; so, essentially, the "unsubsidized" price for the iPhone 3G is going to be $199 + the ETF." To which I add, plus one or two months of service.Other readers clarify that "non-qualified upgrades" refer to existing non-iPhone customers who have not yet finished their equipment terms and would be expected to pay a penalty for equipment changes.Although I wonder if it would be cheaper just to buy a foreign iPhone, I'm still hoping that Apple sells them in-box unactivated at their store. And there's got to be some sort of developer solution that doesn't involve contracts for each development unit.Here's some math from TUAW reader Mike: $199 for iPhone 3G $ 36 to activate $ 80 approximate, one month service plus taxes $170 Early Termination Fee That adds up to about $485 + tax for a 8 GB ($585 + tax for 16 GB).
Germany wants $6.2 million in research subsidies back from Nokia
As if being on the hook for $92 million wasn't enough, Nokia is now being chased down for what looks to be another €4 million or so, which comes out to just over $6.2 million. This time, the German government is "demanding" that Nokia repay said amount in research subsidies now that it is closing its factory in Bochum. Reportedly, the German Research Ministry gifted the cellphone maker with €4 million in order to "fund four separate research projects dealing primarily with new antennae and wireless transmission technology," and now it's asking Nokia to "explain by early April which patent filings resulted from the projects and which German production or research sites benefited from the results of the projects." So much for basking in the glory of Q4, eh? [Via IntoMobile, image courtesy of Reuters]
German state after $92 million in subsidies, interest from Nokia
Looks as if Nokia's going to be using a portion of that gigantic profit it raked in during Q4 to appease NRW.Bank -- unless a meeting it hopes to establish within the next few days changes matters, that is. Apparently, a German state has "asked" the handset maker to hand back government-issued subsidies (with interest, no less) that it received to build a cellphone factory in Bochum which it now plans to close. In sum, Nokia's looking at a tab of $92 million, as the folks in the industrial Ruhr region are none too pleased about what will likely result in the loss of some 2,300 jobs. Purportedly, the cash is due by March 31st, and if Nokia refuses to comply, the bank has stated that it will "take legal action to secure payment." Them's fightin' words there.
Japanese carriers losing out on handset subsidies
In the fierce world of wireless competition, companies fight tooth-and-nail for customers in a desperate attempt to raise ARPU (Average Revenue Per User). Customers are naturally looking for the best deal, and with multiple carriers selling the same or similar handsets, the consumer's decision carries a lot of weight. The same problem that exists here in the States is even more prevalent in Japan where the country's largest carrier, NTT DoCoMo, attempts to pack cell phones with such features as bar code scanners, TV receivers and gaming devices. All those goodies cause manufacturing costs to soar in excess of $600, requiring the carrier to discount the handset heavily to prevent customers from getting spooked at the store. Sounds like a steal, right? Not so much. All these subsidies end up costing the companies around $16 billion a year which in turn leads to higher plan prices to recoup the blown revenue from the devices. All in all, it's a vicious circle -- but hey, at least it's a technology-laden one.[Via textually.org]
iPhone rebates or subsidies?
In the US most carriers offer rebates and/or subsidies to offset the cost of phones and their contracts. Will Apple follow this trend? Rumors are swirling that they might just do so. According to several sources including Apple Insider, American Technology analyst Shaw Wu says Apple is considering offering a mail-in rebate or carrier subsidy in the $50 to $150 range. When you compare this amount to the guaranteed revenues from many data cell phone plans (they can run into the multiple thousands of dollars over a two year contract), it's a drop in the bucket.
iPhone manufacturing cost estimated at $245.83...maybe
Steve Ballmer might go on about the iPhone being heavily subsidized, but today's Mobile Magazine reveals that the iPhone might be cheaper to build than you think. According to their estimates, the 4GB iPhone costs $245.83 to manufacture, about half of the five hundred dollar asking price. Add another $35 to step up to 8GB onboard. "Of course," they add, "These figures don't include R&D, advertising, and Steve Jobs' expense account." If right, this dramatically undercuts the notion that Cingular is massively subsidizing the iPhone in order to bring the price into line with consumer expectations. It also brings the possibility of a phone-less (albeit pretty expensive) G6 iPod into greater likelihood.I'm not big on equipment and manufacturing costing. For all I know, they are pulling these numbers out of thin air (John Gruber at Daring Fireball seems to think so, linking to Apple Insider), but it's certainly an interesting place to continue discussing the "subsidies" controversy.
Singapore makes WiFi free, adds computer subsidies
Remember how Singapore was going to provide WiFi for most of the island nation? Well, it looks like they're taking that one step further by taking the S$100 million ($63 million) cost to the government, eating it, and giving free access (for the next two to three years) to the laptop-toting public. Further, the government will provide subsidies on computer purchases for low-income families -- according to The Straits Times, families that earn less than S$200 ($125) a month can purchase a computer for S$285 ($179). Why can't we get such forward-thinking policies over on this side of the Pacific?[Via MuniWireless]
