$99 iPhone 5 – AT&T Promotion

By Josh Bickham

Its an obvious sign that AT&T is clearing out space in its inventory for something new.

In fact, many retailers are offering sales associated with the iPhone this month, an omen they are predicting something big to fill the space.  AT&T began its promotion today offering 50% off its entire lineup of smartphones which includes the 16 GB iPhone 5.  That means you can get the most current up to date iPhone available for just $99, with the addition of a 2 year contract of course.  The offer includes any smartphone sold by AT&T, which implies an iPhone 4S will only run you $49.  All offers include free activation and also free shipping if you opt to order the phone on AT&T’s website vs. an in-store visit.

Best Buy and Wal-Mart are also offering up discounts on the iPhone 5 in addition to the one AT&T announced today.  Best Buy is reducing the cost of their iPhone 5’s by $50, making it $149, and Wal-Mart is offering up its big savings by cutting the price to $129, both under the condition that you commit to another 2 year contract.  So far, it looks as though AT&T has the biggest deal, which is good news for current or soon to be AT&T customers.

It’s not unusual to see a retailer have a promotional offer regarding the discount purchase of an iPhone, but when so many start doing it at once, you know their must be a reason.  Obviously that reason being that they are trying to make room in their inventory for the un-offically un-announced iPhone 5S.  The upcoming newer model iPhone is said to look pretty much the same as the current one, but have substantial  internal improvements which includes a processing and camera upgrade.  Rumor also has it that there will be a new “budget” iPhone sporting a somewhat thicker rounder look while offering some of the same, but probably more restricted, features as the iPhone 5 but at a cheaper and more affordable price than the standard version.

While Best Buy and Wal-Mart’s offers are good indefinitely for now, AT&T’s offer is only good through the end of the month.  And if you plan to walk into an AT&T store, the deal requires that you have a trade-in device that you are going to upgrade.  The online offer does not have this requirement.

Things to Know Before You Upgrade

All of this comes after AT&T’s announcement earlier this year that it is suspending its Revised Upgrading Policy to its millions of customers.  Previously, AT&T had given customers the chance to upgrade their phones to a newer model 4 months early of their 24 month contracts and still get the full subsidized phone upgrade.  What that means is that if a customer agrees to use AT&T’s service for 2 years, they only pay $199 for a new iPhone rather than the retail price of $649.  Under the new policy, any customer who signed a new contract agreement during or after March 2012, will have to wait a full 24 months before they can upgrade their phone and receive the full subsidized phone upgrade.  Any customer who signed a contract before March 2012 can still upgrade their phone at the end of their 20 month period, but after that, they will have to wait 24 months before they qualify for the full subsidized phone upgrade.  You can always upgrade your phone at anytime and renew your 2 year contract, but you will only get part of the phone upgrade subsidy for upgrading before the end of your 2 year agreement.

This just so happens to occur at the same time as the new $0.61 a month additional “Mobility Administrative Fee” that went into effect on May 1st of this year.  The new “administrative fee” is being tallied under the line, right next to all the other taxes and fees at the end of your bill.  AT&T says the new fee will “help cover certain expenses, such as interconnection and cell site rents and maintenance.” It also added that the charge is “consistent with similar fees charged by other carriers.”  It is true that other carriers do charge this fee, and it is actually more than what AT&T is charging.  With the suspension of the early upgrade offer, AT&T has now guaranteed an extra 4 months in fees per year of your service making the total $7.32 a year.  That doesn’t seem like a lot in 2 years, but you if you multiply that total by the more than 100 million AT&T customers you get a number that is in the billions of dollars.  If you ask me, knowing that information seems to make the new promotional offer a little less appreciative to its customers and a little more like corporate shenanigans.


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