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September 29th, 2009Why Rogers is holding back the iPhone 3GS

Posted by Editor in android, apple, Rogers

Still waiting for your iPhone 3GS? You are not alone. Since the launch of apple’s swankiest new unit we’ve seen the waiting list stretching out months for anyone foolheardy enough to have ordered one online, or from a Rogers call center rep. Rogers retail stores do have them, but only in handfuls at a time. One store rep we spoke with said he was only getting a third of the number of devices they were requesting on a weekly basis.

The reason? The iPhone is costing Rogers too much. Apple’s elegant one $199 price doesn’t jibe with Rogers subscriber revenue. Or at least the math doesn’t jibe as well with the kind of margins that Rogers has gotten used to earning off of smartphone subscribers. Rogers is suffering margin compression with the iPhone 3GS. While they love the halo effect of the iPhone, they’d love even more if they could lure you in the store with thoughts of iPhone dancing in your head… and then sell you the exact same voice and data plan but fob you off on, say, a much less subsidized HTC Android for example.

We don’t know if Rogers is revenue sharing on the iPhone with Apple but, apparently, the difference between the actual price of the device and mandated $199 subsidized price is such that Rogers is going so far as to aggressively market the Android down to $79 (and $39 for students).

This is not such a bad story for consumers. The android is a half-decent device, and $39/$79 is the kind of entry point for smartphones that could really start driving penetration of smart phones in Canada (if not, you know, for those whopper monthly bills you’ll still enjoy but we digress). And a few more androids or blackberries in the global marketshare pie chart does help to keep apple honest.

http://www.christopher-parsons.com/ Christopher Parsons

Apparently Victoria BC is rife with the 3GSes (16 and 32GB models) – I had zero issues getting a 32GB model today, and the reps I spoke with said that they were being shipped to stores before going to online reserve.
http://twitter.com/ajbraun ajbraun

As Android devices begin to proliferate, there is little reason for Rogers to continue to subsidize Apple. Apple's great selling point of an end to end ecosystem will be replicated with the added benefit of consumer choice of industrial design
George Lee

Really? Which location did you get it from. I'm in Victoria too and I'm looking to get one for Fido. I've been waiting for weeks!
http://www.christopher-parsons.com/ Christopher Parsons

@ George Lee – Got mine at the Bay Center downtown, in the basement.
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http://m-strat.org/monday-morning-mobile-catchup-%e2%80%93-october-509/ Monday Morning Mobile Catchup – October 5/09 | Mobile Strategy

[...] Why Rogers is holding back the iPhone 3GS [...]
http://www.peopull.com/ Sina

With all due respect, you couldn't be more wrong.

Rogers is not holding back anything, and they certainly wouldn't mind selling more iPhones.

The problem is that now with the 3GS, unlike last year with the 3G, Apple stores are selling iPhones too.

Apple has decided to give Apple stores first dibs on the limited quantity of iPhones which makes sense because people get the full Apple experience and Apple has a chance to upsell some of their other products.

And I remember reading another article saying that due to the high global demand, Apple has shifted some stock from Canada to other companies that have a higher demand, which only makes sense.
http://www.peopull.com/ Sina

meant to say countries, not companies*
http://www.peopull.com/ Sina

With all due respect, you couldn't be more wrong.

Rogers is not holding back anything, and they certainly wouldn't mind selling more iPhones.

The problem is that now with the 3GS, unlike last year with the 3G, Apple stores are selling iPhones too.

Apple has decided to give Apple stores first dibs on the limited quantity of iPhones which makes sense because people get the full Apple experience and Apple has a chance to upsell some of their other products.

And I remember reading another article saying that due to the high global demand, Apple has shifted some stock from Canada to other companies that have a higher demand, which only makes sense.
http://www.peopull.com/ Sina

meant to say countries, not companies*

September 29th, 2009Why Rogers is holding back the iPhone 3GS

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