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Deal Alerter

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July 2, 2007

iPhone Upgrades: Discount Downgrades

Filed under: Internet, Retail, Telephone — Edgar @ 5:26 am

iPhoneAs people lined up to buy iPhones last Friday, some purchasers got less than they bargained for.

One consumer wrote to Mouse Print* saying he bought an iPhone for his fiancée to replace a more conventional phone on her existing AT&T plan. Besides paying $500, and based on material that was handed to him at the Apple store, he expected that her monthly cell bill would only rise by $20 to cover the cost of just adding a data plan.

From AT&T’s website:

Q. Do I need to switch to a different rate plan if I upgrade to iPhone?


A. If you’re an existing AT&T (formerly Cingular) wireless customer, you just need to add an iPhone Data Plan. (This may replace your current data plan. Your voice plan will stay the same) The iPhone Data Plan gives you Visual Voicemail, as well as Unlimited Data—includes both email and web—and texting, all for as little as $20. You’ll add an iPhone Data Plan and sign a new 2-year service contract during the activation process. Discount eligibility for other devices will continue from the time of your most recent contract.

Everything seemed fine for the soon-to-be-groom until he went home to activate the phone via his computer. A notice came up that said “all discounts will be lost.”  This was troublesome since his fiancée had a 15% educational discount on the calling plan that all teachers in her state can have. Since the loss of the discount seemed contrary to his understanding from Apple and AT&T, he continued the activation process. After hours on the phone and back at the store, he learned the truth.

*MOUSE PRINT:

Q. Are business customers eligible for discounts?
A.
No. iPhone service is available only to consumer accounts. iPhone and associated wireless service are not eligible for corporate discounts. 

Apparently, her discount plan caused her account to be coded as a “business.”

The consumer said he was not given anything at the store to indicate he would lose the plan discount his girlfriend was receiving. Even the Apple site currently says “If you’re already an AT&T customer and want to keep your current voice plan, you can just add an iPhone Data Plan with unlimited data (email and web) and Visual Voicemail for just $20 per month.”

Worse news came when the consumer checked their refund policy:

*MOUSE PRINT: “You can return your iPhone within 14 days for a full refund, but there is a 10% restocking fee if the box has been opened.”

Our consumer is not alone in his iPhone woes. People on family plans through their employer, for example, cannot merely add an iPhone to their account. An entirely separate individual plan must be purchased, from outside the company, and without any corporate discounts. [See CNN Money story.]

All these consumers may have a good case for requiring Apple/AT&T to waive the restocking fee should they want to return their phone. Sellers generally are required to disclose key facts that might have induced prospective buyers not to make their purchase in the first place.

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4 Comments »

  1. And when it’s all said and done, you’re left with a very expensive phone, that is only just average for voice calls.

    Comment by Pondscum — July 2, 2007 @ 9:30 am
  2. Just sell it to some other techno-geek that has to have one right away.
    Bottom line for me is that it is just another expensive gadget that does way more than the average user has a need for.

    Comment by Tomsym — July 2, 2007 @ 3:46 pm
  3. What do you expect from a company that is constantly claiming to have the world’s fastest personal
    computer which is not the fastest by the time it actually gets delivered, or advertises that there is no
    step 3 (but fails to mention step 4-20)?

    I have as much use for an i phone as I do for an i pod or an i Mac! As for iphoto, I was using that on
    my PC back in 1993! [I've always wondered how they got away with using a name essentially identical to
    one already used by Ulead!]

    Comment by John A Elson — July 6, 2007 @ 9:36 am
  4. Too bad there isn’t “truth in advertising” rules in place for the Iphone. Then it
    would be advertised as what it REALLY is. A small vacuum device that sucks all
    the money right out of you. That’s the Apple way, and fools keep falling for it.

    Comment by Dave — July 23, 2007 @ 10:45 am

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