Wednesday, July 9, 2008

Christmas in July, iPhone 3G with a lump of coal called AT&T

iPhone 3G coming soon, to billionaire and plebe alike. All the gadget geeks are giddy with anticipation. I'm stunned that Walt Mossberg was allowed to get one early, after dissing the MacBook Air like he did. Somebody probably had a little chat with him, first. They probably took it away from him when he was done writing the review, too.

The early reviews came out, and they are very positive.

For iPhone, the ‘New’ Is Relative

Newer, Faster, Cheaper iPhone 3G

Software and Online Store Will Widen Its Versatility, But There Are Hidden Costs

Apple's new iPhone 3G: Still not perfect, but really close

Santa's displaying a bit of ironic detachment this year, however, as he leaves in our stocking on July 11, a shiny new iPhone, along with a lump of coal.

The reviews don't mention the dark cloud behind the silver lining of the new iPhone 3G. There's really only one thing wrong with the iPhone,in the US market: It's still tied to AT&T. What a disaster of a phone company. None of them will talk to me about it, but I can see in their eyes that everyone at Apple, I mean everyone from el Jobso down to the janitor, is painfully aware that AT&T is holding them back in the US Market. Almost every iPhone user they talk to makes a point of mentioning it, and they are so weary of hearing it. Weary, like Americans traveling abroad are weary of hearing about what a tard our President is. Yeah, we Americans who travel abroad already know that. The perplexing 30% who manage to think Bushie is doing a great job don't seem to travel abroad, or if they do, they pretend to be Canadian, eh?

The only saving grace is that pretty much all cell phone companies in the US market suck, and people are beaten down so much by this fact that they wearily accept it.

Apple probably expected to comfortably exceed their stated goal of shipping 10 million iPhone by the end of 2008. They are likely to meet that goal, barring even worse economic news between now and December, but they won't exceed it by much. They had secretly hoped to sell nearly that many first generation units, but they sold 6 million. That's an amazing entrance for a device like this, nothing to sneeze at, but not quite as amazing as they wanted.

AT&T worked diligently day and night to counter balance the sky high customer satisfaction that people report with their iPhone. Everyone who has iPhone with AT&T tells their friends the same thing, "I love my iPhone, but AT&T is dreadful, and I will take my iPhone to another phone company the first day that I can do that, without jail breaking the phone." After giving them the benefit of doubt for a year, it now seems undeniable that the "new" AT&T is the same old AT&T, after all.

Obviously so many people were willing to jail break their phone to get away from AT&T that the registration process had to be changed to prevent people from buying a phone without the AT&T contract in the US market.

Their biggest complaints?

  • Spotty service, dropped calls, "No Service" at all, for a few minutes at a time in areas that, moments before, had 5-Bar service. Oh, sure, this can happen with any cell phone, but with AT&T it happens in areas that ought to have stellar coverage, like right in the heart of the major cities that AT&T likes to service, while ignoring most of the country. It happens chronically. It happens to AT&T customers using any type of phone, not just the iPhone.
  • Ignoring most of the country. There are several entire states where AT&T won't sell you a phone at all. There are ways to correct this, but AT&T doesn't appear to have any interest in actually providing nationwide service, only in claiming that they do so. Granted, this problem exists for certain other cell phone companies, too, but Verizon does a better job of providing service to non-urban areas of the US, by far.
  • Bills are random. AT&T customers get sold a flat rate plan where the bill is so complex that AT&T can't explain it to you when you call them. Flat rate plans somehow result in bills that are different from month to month. Overcharges are common, but you can't get them refunded because AT&T can't explain the bill to you in such a way that you could actually spot them.
  • AT&T rates are already Viking marauder "rape and pillage" rates, as compared to TMobile, Verizon, and other companies in the US. This one really bugs Apple. Apple's products are extraordinarily popular with young people, who today all have an iPod, and a cell phone -- a cell phone from any vendor other than AT&T because their rates are so much higher. The entry level iPhone plan is about twice as expensive as the rates paid by most of the under-thirty crowd that Apple dearly wants to use this phone. Apple's surveys show this as the number one barrier cited by potential under-thirty customers. They can't do anything about it yet, which is probably one of the reasons why iPhone 2.0 new features focus so clearly on the over-50-and-runs-a-company set, Enterprise CEO and other executives.

The best news for Apple is that they are getting iPhone into so many other countries that it doesn't really matter, this year, if AT&T continues to be the dinosaur that it has been. Apple will sell container loads of iPhones. Even in the US Market, iPhone has such a lead that it will continue to grow rapidly, despite the best efforts of AT&T to keep it down.

Get cracking AT&T. Listen to your customers. Listen to Apple. Fix your network. Stop trying to use a complicated billing system to generate revenue by cheating your loyal (e.g. locked in) customers. Think Different, and you could be the Apple of phone companies, loved, rather than hated by your customers. Your customers want to love you. Give them a chance.

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