iPhone Upgrade Fee Jumps $50 for AT&T Users

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AT&T customers looking to upgrade to an iPhone 4 — or replace it — before the two-year contract expires are going to have to shell out an extra $50, according to AT&T's new contract agreements.

A drop in the early upgrade pricing was at least partially responsible for the success of the iPhone 4. Apple's latest smartphone sold out in almost every store across the country and required a two-week waiting period for most people looking to upgrade. But that's because AT&T gave just about every iPhone user — both 3G S and 3G owners — the option to upgrade to the iPhone 4 at a steep discount.

AT&T had earlier charged iPhone 3G users an extra $200 to upgrade to the 3G S before their two-year contract had expired. AT&T eventually offered 3G owners the chance to upgrade to a 3G S at the same discounted price. The move followed customer criticism about having to pay a $200 fee to upgrade to the iPhone 3GS before their two-year contract was over.

The company might have shot itself in the foot by offering that cheaper upgrade option. Any massive upgrade in the upgrade fee for the iPhone would end up causing a huge public backlash against the company. AT&T likely chose to increase the price incrementally to see if it can recoup some of the costs of subsidizing the iPhone 4 — and the next version of the iPhone.

Tags: eligibility, iPhone, iPhone 4, iPhone 5, upgrade fee

Companies: Apple, AT&T

By MIGUEL HELFT 05 Apr, 2011

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Source: http://feeds.nytimes.com/click.phdo?i=c942c9c8a25e3c8206765562695bdf6f
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