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iPhone 3G owners and AT&T upgrade woes

by Michael Jones Jun 8th 2009 at 5:30PM

With the introduction of the new iPhone 3G S at WWDC, existing AT&T customers who wish to upgrade to the new model are quickly finding out that they are not eligible for the pricing announced today.

If you were among the first 10 million customers to pick up the original iPhone, and you have not upgraded to the 3G, chances are your AT&T account lists your iPhone as eligible for an upgrade. But for many users, this is sadly not the case. Several readers have written in, letting us know that AT&T is not offering upgrade pricing for existing iPhone 3G owners, and is asking $599 for the new 16GB 3G S, or $699 for the 32GB model. Others have things a little easier, with AT&T offering $399 or $499 upgrade pricing. Now that's definitely not the rosy picture that was painted on the slide at WWDC this morning, is it?

So what can you do if you want to upgrade? Well, you might have a few options. For starters, the typical contract cancellation fee is $175. So, depending on your plan, you may be able to save some money by just canceling the contract, then purchasing the iPhone as a new contract. Keep in mind, by doing this, you'll probably need to wait 90 days or so to sign-up with AT&T (in your name anyway) and you'll lose your existing phone number.

You might also want to consider adding a new iPhone as an additional line to your account. If you don't have a spouse or family member to share your existing iPhone 3G with, the additional monthly fees for the new iPhone 3G S probably won't end up saving you any money (in fact, you can pretty much guarantee it won't), but if you want a new iPhone and have a person you can share your existing iPhone 3G with, this might be an option.


Upgrade screen for an AT&T customer just a couple of months shy of the 18-month threshold.

Finally, you can always resort to the old standby method: subsidize the cost by selling your existing phone. Since the hardware changes are fairly minimal with the new model, it's a safe bet that the 3G will still be in good demand, at least for a little while. Chances are pretty good that you can recoup some, if not all, of the cost of the new phone by selling your old 3G after you have upgraded. This is particularly true for 3G phones that have been jailbroken or unlocked. Even though the 8GB iPhone 3G will be selling for $99, users who want to use a phone without a contract or potentially with another carrier are foaming at the mouth for the iPhone.

Keep in mind that these are just suggestions, and may or may not work for everyone in all cases. If all else fails, talk to someone at AT&T. You might just get lucky and find someone who is able to help you out. If you want to wait out your existing contract, it appears that AT&T will approve you for upgrade pricing 18 months into your contract. So if you got an iPhone 3G last June, you can look at upgrading to the iPhone 3G S at the end of December.

Will you be upgrading your iPhone 3G to a 3G S, despite the steep price, or will you wait until you are eligible to upgrade? Let us know in the comments!

Update: As many of you have pointed out in the comments, much of the reasoning behind this is due to the fact that the 3G iPhone's cost was subsidized, meaning that AT&T could sell you the phone for a lower price, while locking you into a two year contract and recouping the remainder of the phone's cost over the length of that contract. In contrast, the original iPhone's cost was not subsidized, which allowed more flexibliity to those wanting to upgrade their phones early.

In all fairness to AT&T, this is the same practice that is followed by most other carriers around the world. However, much of the confusion comes with the fact that many customers were allowed to upgrade to the 3G last year if they owned the original iPhone.

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With the introduction of the new iPhone 3G S at WWDC, existing AT&T customers who wish to upgrade to the new model are quickly finding...
 

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235 Comments

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Eric W

Come on people, why do you all have such a problem with this? You don't see all the people with Blackberry's complaining when the new version of the Blackberry comes out every year. This is the same situation. Apple puts out a new phone and you all act like it's some sin against all humanity because you can't get it for the upgrade price. You signed a 2 year contract and got a huge discount on the iphone so now you have to wait for that contract to be over before you can get another huge discount on the next one.

June 18 2009 at 5:26 PM Report abuse rate up rate down Reply
Amanda

I would like to know what is the difference betweene the 3.0 upgrade and the new 3gs?

June 17 2009 at 6:08 PM Report abuse rate up rate down Reply
cpljwlusmc

Ever think of just waiting until you're eligible?

I got my iPhone August of 2008. I'm eligible 8/7/09. I alrady have an iPhone 3G, I have iPhone OS 3.0, so that'll just tie me over until my approved upgrade date. Why does everyone need instant gratification?

June 17 2009 at 5:26 AM Report abuse rate up rate down Reply
wHiTEbOii

first off this is complete bullshit att should make existing customers pay an extra 200 $ plus the 18 extra for and early upgrade fee on top of the iphone 3g s cost. if you think about its makes no sense to even buy a new iphone if you have a perfectly functioning ipone in your hand. second ed is right if you cant afford buying a new iphone then dont buy it your not obligated to but the new1 all it is a a camara upgrade basically and some other minor details. is u have and iphone 3g the new software update has all the stuff the new iphone has except for the damn camara, (teathering if att is even gonna support tht i doubt it) and voice controls. i have not seen a single person in a few years use a voice dial or voice any thing on a phone. simply becuse the phone is programed for perfect english and noone speaks perfect english. and teathering is gonna be complete bullshit too because knowing att there gonna throw in another charge to us the teathering function on the fone and teathering makes no sense i mean ok if your a bussiness person i can see y u would need it but a regular person doesnt normaly go around wwith a laptop and nd iphone tht just screams mug me. all att is gonna do is piss customers off like my self and there going to lose customers and be screwed so good luck att ur gonna need it cocksuckers

June 16 2009 at 1:01 AM Report abuse rate up rate down Reply
jzschau

There are cheaper options than paying full-price: http://tinyurl.com/m8n2gb

June 15 2009 at 4:38 PM Report abuse rate up rate down Reply
Rich

What's ticking me off at this point, is I paid full price for my 3g because I wasn't up for an upgrade yet. I didn't have a problem with it as it's a piece of technology which has really made my life easier. But to blanketly say all 3g owners have to pay full price even those that didn't buy the subsidized iPhone 3G...they can eat me. I really wanted to get the new 3gs just for the storage space, but at 600 bucks, forget it. I'll wait until next years release thank you very much.

June 15 2009 at 9:07 AM Report abuse rate up rate down Reply
neilxxx

I understand the need for the charge because of the upgrade situation, but the timing will kill the new IPhone 3S.
People just don't have the money now, plain and simple.

Apple and ATT should start a program whereby they match older 3G users with first time iPhone buyers to facilitate the sale.

But, I can easily afford it and there is just not enough in the phone to shell out $499.
I plan on buying a Flip HD for Video, now tell my why I need the 3S again?

June 15 2009 at 1:10 AM Report abuse rate up rate down Reply
KevinCamera

Don't think the lines will be as long as the last 2 launches. In the
weeks before the announcement of the 3Gs, 12 of the 15 1st Gen. users I
know are "NOT" going to upgrade. The reason is 20.00 Plus 200 free SMS to now go to 15.00+ extra for the 3G & 3Gs.
Most say they have Wi-Fi were they are most of the time
So adding 3G not a big deal. But I'm going to Pick up my 3Gs — 7AM on the
19TH! I just got back from my local AT&T store and have a Paid preorder for a 32GB Black iPhone. Paid 299.00, How, as I have had 3G from Day One.
have a family plan and one of my 10.00 lines was iphone eligible. I
just have to bring in the 3G and the old RAZR and they will setup the new 3Gs,then port it back to my phone #. I get to keep my "OLD" 3G free and
clear and have the NEW 3Gs ready to go. To top it off, they had one
more Apple Bluetooth headset for 49.00 on closeout. I'm going to
craigslist the "OLD" 16GB MINT 3G with the new headset should get
400.00 For both with ease. AT&T did right by me.

June 14 2009 at 9:16 AM Report abuse rate up rate down Reply
David

One Question People:

If i am not wrong, any mortal can buy a Iphone 3GS for $599/699 without contract? or you must have a AT&T contract to buy one?

June 12 2009 at 7:20 PM Report abuse rate up rate down Reply
1 reply to David's comment
BigTomTom

No that's not true. You are locked into a two-year contract regardless. If you are using an iphone with AT&T, there is a two-year contract tied to it. Period. Everybody that bought an iphone at full price, you had to sign a two-year contract, and if you got it at the discount, excuse me, "subsidized" price, you had to sign a two year contract. That's why this whole thing about "subsidized" pricing is a bunch of crap. Every original iphone owner paid full price for their phone AND had to sign a two year contract just to have the privilege of using it. And about a third of 3G owners paid full price for their phones, and guess what? TWO YEAR CONTRACT! I should know. I bought 2 iphone 3G models (8GB) for $400 each from AT&T, but can't upgrade them to the 3GS without paying FULL price again! How fair is that? So when I hear people whine and complain about getting the new phone at $199 when they got their last phone at $199, I am really not sympathetic. I have already spent 4X as much as they already did, and if I want to get the new phone, I will have to spend another $400 or so each. That means $1600 for me and $400 for them. Finish out your contract, so that people like me don't have to pay for it!!!

June 13 2009 at 3:06 AM Report abuse rate up rate down Reply
Bella

I already bought mine; 32GB and yes for the full price on Apple.com... it will arrive on the 19th! i couldnt help myself!! i have had 1st generation and the 3g. and i couldnt wait till my upgrade. i am in deed an apple/mac lover 110%!! sooo excited to get it!!! i have had MANY cell phones.. and BY FAR my iPhone is the best i have ever had, I dont know what i would do with out it!

June 12 2009 at 1:06 PM Report abuse rate up rate down Reply
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