Activation idea for the next iphone launch

[jmaxima]

There's no question that the iphone 3G launch day created a frustrating experience due to activation issues. Here's an idea to speed up then line.

Since you pretty much have to use a credit card to purchase the phone, Apple should charge the full unsubsidized amount, whether it be 399 or 599, and then refund the subsidized difference (~$200) when the customer gets home and activates it on AT&T's network, who will in turn reimburse Apple ($~200).

Benefits:
-Quicker transaction times equating to faster lines
-Apple gets full amount of their phone
-AT&T wouldn't lose any money since people will sign up on their network to get the reimbursement (if not, it's the same as canceling after 30 days).
-Customers get to activate the phone on their own time if for some reason the servers are unavailable.
-Customer does not really have to pay the ~$200 since it's on the credit card and gets reimbursed right away.

This would work for the straight-forward purchase (new AT&T customer, upgrade from original iphone, etc). Maybe there could be a separate express line for these customers.

What do you think?

 

[Michael CM1]

OK, I see your plan, but I don't want them plopping $700 on my credit card when I'm not one of the guilty unlockers that caused this mess. This also causes other problems.

Best idea is to charge people the upgrade price and have them agree to a "non-activation fee" of $400 if the phone isn't activated within 30 days. Then people can do it at home LIKE BEFORE AND IT WAS SO...DARN...EASY.

After dealing with countless mentally challenged people when trying to activate a phone, doing it through iTunes was a blessing.

May I also suggest this to other people: YOU DON'T HAVE TO BUY AN IPHONE THE FIRST DAY IT IS AVAILABLE. May I advise letting other people deal with the first-day madness, waiting a week, and then getting one? Or you can wait longer and see if there are any major glitches.

 

[onesixeight]

I think that's a great idea...and one that I too suggested in another thread.

BUT! As a telecom equity analysis, Apple wanted to make it a point to advertise the $199/$299 price point and charging the unsubsidized price would have turned away many of the people who didn't buy the 1st gen iphone, and are now attracted to the lower price point. I know the concept that you'd get the money back when you activate the phone at home, but there is something about the psychological factor of the lower price point that brings people into the stores.

After observing the local snafus and ones across the world, Apple may need to consider this idea. There is no question that this is not what Apple had in mind in terms of a successful launch day for the new phone.

 

[onesixeight]

Best idea is to charge people the upgrade price and have them agree to a "non-activation fee" of $400 if the phone isn't activated within 30 days. Then people can do it at home LIKE BEFORE AND IT WAS SO...DARN...EASY.

Michael,

Those are some great points, and I agree with you that people don't like the idea of having a $700 pre-approval on their credit card. Especially younger folks who don't have huge credit limits on their card, or those using debit cards.

But regarding the non-activation fee after 30 days, I can tell you that will be hard to pull off. A customer planning to unlock this phone could easily cancel his credit cards, and since most of these buyers are foreign, they'd be long gone before Apple or AT&T can secure this fee.

 

[jmaxima]

I think that's a great idea...and one that I too suggested in another thread.

BUT! As a telecom equity analysis, Apple wanted to make it a point to advertise the $199/$299 price point and charging the unsubsidized price would have turned away many of the people who didn't buy the 1st gen iphone, and are now attracted to the lower price point. I know the concept that you'd get the money back when you activate the phone at home, but there is something about the psychological factor of the lower price point that brings people into the stores.

After observing the local snafus and ones across the world, Apple may need to consider this idea. There is no question that this is not what Apple had in mind in terms of a successful launch day for the new phone.

Glad to hear that I wasn't the only one thinking this. Good insight about the psychological factor of having to pay more upfront. Maybe Michael's suggesion about the non-activation fee could also work.

If a separate express line was created with this method, I'm sure people would gladly pay the temporary activation fee just to get through the line quicker.

 

[jmaxima]

Michael,

Those are some great points, and I agree with you that people don't like the idea of having a $700 pre-approval on their credit card. Especially younger folks who don't have huge credit limits on their card, or those using debit cards.

But regarding the non-activation fee after 30 days, I can tell you that will be hard to pull off. A customer planning to unlock this phone could easily cancel his credit cards, and since most of these buyers are foreign, they'd be long gone before Apple or AT&T can secure this fee.

Good point, the non-activation fee wouldn't work due to the potential inability to charge the subsequent fee at a later time.

 

[nokiauk]

how's about this for another idea: Unlockers exist for 1 reason cause Apple made a disastrous decision to partner with certain providers with silly overpriced call plans.

The next iPhone should be sold from Apple only as per their other devices and unlocked and available for anyone to choose any provider and calling plan they like, no queues, no activation, just simple.

 

[onesixeight]

how's about this for another idea: Unlockers exist for 1 reason cause Apple made a disastrous decision to partner with certain providers with silly overpriced call plans.

The next iPhone should be sold from Apple only as per their other devices and unlocked and available for anyone to choose any provider and calling plan they like, no queues, no activation, just simple.

I believe AT&T has a 5 year exclusivity deal with Apple for the iPhone, so it will be a few more generations before we see this happen. Apple made such a deal because they were one of the few carriers to accept a revenue sharing plan.

We are starting to see countries such as Italy who have more than one wireless carrier selling the iPhone. So it's definitely an idea, but it'll be a few years before we see such a plan in the US