AT&T considering $10 reduction in monthly iPhone plans

Mon, May 18, 2009

News, Rumors

In an apparent attempt to open up the iPhone to even more customers, AT&T is reportedly considering dropping the price of its unlimited data plan for the iPhone from $70 down to $60.

BusinessWeek reports:

The exclusive U.S. iPhone service provider is considering cutting the price of its monthly service package or offering a range of lower-priced plans, say people with knowledge of the company’s thinking. One plan that could be introduced as early as late May would include limited data access at a $10 monthly reduction, the people say.

The possible price cut likely reflects the back-and-forth between AT&T and Apple as they work out whether and under what terms AT&T would remain the sole U.S. iPhone carrier. Apple may want flexibility in pricing as a condition, analysts say.

I’m sure AT&T is loathe to initiate any price drop, but with AT&T’s exclusive rights to sell the iPhone rumored to expire in 2010, it might just have to be bite the bullet if it wants to maintain the iPhone as an AT&T only device.

Nevertheless, I think it remains in Apple’s best interests to make the iPhone available to other carriers the first chance it gets.  Once the iPhone becomes available on Verizon, for example, the natural competition between Verizon and AT&T would drive down prices regardless.  In that scenario, Apple would get the best of both worlds – a cheaper data plan for iPhone users, and a much larger base of potential customers.


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