Allan Keiter is a mobile guru and cofounder of MyRatePlan.com. Today, he told me that his business has been going gangbusters and it's probably because of the buzz-fest from Apple's (NASDAQ: AAPL) iPhone. "We are having one of our best months ever," he said. "Anyone who hasn't upgraded their phone in the last 2-3 years may as well be driving a Model T."
Here's my interview with him:
What's your general take on the iPhone?
Nice leap forward in the goal of a converged device (i.e., carry one phone/music player/camera device instead of 3 gadgets). Touch screen innovation will probably be appealing, particularly to the early adopters. If someone wants a phone with a full-featured iPod, and price is no object, it is really the only game in town. However, price points are quite high in a market conditioned to pay nothing, or next-to-nothing for a new cell phone.
As I point out on the link I sent earlier, it will be much more cost-effective to get a free music phone, and save the $500. If you have to have iTunes, take $200 and buy a Nano (same 4GB memory), then take the $300 left over and fill your music library with 300 songs from the iTunes store.
What do you think of the data plan? Might it have sticker shock with consumers?
The pricing they have set up means a minimum commitment of about $2,000 to buy and use the iPhone for two years ($59.99 * 24 + $500/phone + taxes).
Not sure if there will be more sticker shock on the phone or on the rate plans that will likely change over time. Taken together, though, it makes me wonder how deeply they'll be able to penetrate the mass market without cutting the phone price.
Note that the rate plans are really just a bundle of current AT&T (NYSE: T) rate plans + $20 data package. That is essentially the same pricing/functionality as for their MEdia Max data plan (for non-smartphones). The requirement to have the data plan serves AT&T well (investors like to see higher revenue per subscriber numbers, after all).
Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.
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