It's no secret that I didn't mind AT&T's pricing of their 3G S upgrades. However, 3G owners were upset that they were not offered the same discounts as new customers or those who had not fulfilled their two-year contracts.

Well, good news for those 3G owners who are wanting to upgrade to the 3G S. AT&T listened to your complaints and published an open letter and YouTube video explaining that current 3G customers may be given much better upgrade pricing when the 3G S launches. From the open letter:

"Beginning June 19, iPhone 3G customers [who are] eligible for an upgrade in July, August, or September will get our best upgrade price of $199 (16 GB) and $299 (32 GB)." This is definitely great news for some 3G owners, as it bumps up the date when they can upgrade for less -- however, if your discount date is past September 30, you will still have to wait to get the best pricing. Your upgrade-eligible date is based on both your contract age and your service plan; the more money you spend with AT&T every month, the sooner they will replace your phone.

There is also good news for those of you who have already pre-ordered the new iPhone: if the new eligibility window affects you, AT&T will issue you a credit for the difference.

Although I don't think that AT&T had to make this change in their policy, it's encouraging to know they're listening to their customers and making changes. Now that you're listening, AT&T, how about getting on the ball with MMS and tethering?

One of France's providers, Orange, plans to charge €229 ($318US) for the 32GB version and €149 ($206US) for the 16GB with a one-year minimum contract. The least expensive contract will cost €39 and last two years. Orange plans to open its Champs-Elysées store one minute past midnight on the day of release, which means the French will have their iPhones in hand a full 14 hours before the U.S.

Orange is also releasing a new data plan that has four hours of calling and unlimited e-mail and text messages, 60 TV channels and Internet access through 3G and WiFi at €52 per month, an imporvement over previous plans with fewer TV channels and unlimited texting only at certain times of day. Tethering will also be available at €9.90 per month for 200MB of traffic, or €29.90 for "unlimited service" that will be throttled once the user exceeds 1GB of data.

Germany's T-Mobile, in a similar approach to O2 in the UK, is pricing the iPhone 3G S at €1 for both models, but to get that price the customer must agree to a two year contract at €119.95 per month. The most expensive configuration at the outset is the 32GB phone at €249.95, but it will allow for cheaper contracts.

Orange's competitors, SFR and Bouygues Telecom, have not yet released pricing information. SFR plans to release the 3G S on June 24th, and Bouygues has not yet announced a date.

Update: Italy's provider, TIM, has also released their pricing scheme for prepaid plans: €719 for the 32GB phone and €619 for the 16GB. Thanks, antiorario!

[Via Macworld]

Today, Apple announced a ship date and upgrade pricing for Mac OS X 10.6 Snow Leopard. 10.6 will debut this September as an upgrade for Mac OS X Leopard users for just $29. "We've built on the success of Leopard and created an even better experience for our users from installation to shutdown," said Bertrand Serlet, Apple's senior vice president of Software Engineering in an Apple Press Release. "Apple engineers have made hundreds of improvements so with Snow Leopard your system is going to feel faster, more responsive and even more reliable than before.

Snow Leopard features include built-in Microsoft Exchange 2007 support along with a slicker install process, faster applications, and 64-bit versions of standard applications that boost overall performance. Apple brags that "[u]sers will notice a more responsive Finder; Mail that loads messages 85 percent faster and conducts searches up to 90 percent faster; Time Machine with up to 50 percent faster initial backup; a Dock with Expose integration; a 64-bit version of Safari 4 that boosts the performance of the Nitro JavaScript engine by up to 50 percent and is resistant to crashes caused by plug-ins."

In addition to the $29 single user upgrade, a family pack upgrade will cost $49. Tiger users will pay $169 for a 10.6/iLife box set or $229 for a family pack.

All users who purchased or will purchase a new qualifying Mac between 8 June 2009 and 26 December 2009 will receive a free upgrade package and pay $9.95 for shipping and handling. You must request your up-to-date upgrade within 90 days of your original purchase.

Snow Leopard requires a minimum of 1GB RAM and runs on Intel-based Macintoshes. Full system requirements are hosted at Apple's tech specs page.

I coulda told you this, though I am a little surprised that we've seen the results so fast. Despite iTunes having put the new tiered pricing into effect just last week, Billboard is reporting that they've already seen sales drop on the higher-priced tunes. The iTunes Top 100 chart has 40 different songs with a new price of $1.29, and one day after the changes, those songs dropped an average of 5.3 places on the chart, while cheaper songs moved up on average. And on the second day of the price change, ten of the tracks that saw their prices rise within 24 hours dropped a huge 12.4 chart positions on average.

Of course, we're talking only a matter of days here, and there are all kinds of things that could have affected this average drop -- lots of the tracks that became expensive were from a Rascal Flatts album, and it could be just that the album has lost popularity, bringing the average down. And don't forget that even though these sales figures may be dropping, they haven't dropped nearly enough to show a loss of revenue (though fewer songs may be selling, they're still making more money).

But for those convinced that higher prices mean lower sales numbers, these first few days of figures will seem to connect all of the right dots. We'll have to wait and see if the long-term effects match up to the figures Billboard has seen so far.

In the never-ending battle of where to spend your George Washington's (the paper ones, that is) some battles are won and some battles are lost. In this case, however, it's turned into a bit of a draw. As we previously mentioned the day hath befallen on which iTunes now "features" a variable pricing structure. The three flavors available are $0.69US, $0.99US, and $1.29US with, according to Apple, "many more songs" available at the $0.69US price point.

The idea of a DRM-free iTunes is definitely a popular one that has been requested for years. The unfortunate side-effect, as imposed by the record labels, is that more popular songs are going to be charged a premium over the tried-and-true $0.99US price point. On the other side, however, is the $0.69US price point for songs that nobody wants are less popular. This is unfortunate because, as Victor mentioned, a single dollar is an easy impulse buy to swallow. I'll add to that the fact that it's easy to understand that 3 songs = 3 dollars; while a price of $1.29US is a little bit more challenging for those of us without calculators in our brains.

In my opinion, record labels are going to see a decrease in sales due to this decision. Many people have iTunes account balances and gift cards that are now going to get them less "tune for their buck." The result of that is consumers will buy less (they have less to spend) and they will be more meticulous in deciding what to purchase. DRM-free, iTunes Plus tracks are a novel idea, but the main benefit will be lost on many consumers. The only change they will notice is that the bill has gone up.

Via Macworld

Looking to pick up an iPhone, but not interested in getting bogged down by any contracts with "the Man?" Your time may have come -- The Boy Genius apparently got their hands on some slides from an AT&T training session saying on March 26, AT&T will offer a "No-commit" for their existing customers on both iPhone models -- it'll be $599 for the 8GB and $699 for the 16GB.

This isn't quite a deal anyone's planning to jump at, however, since the phones themselves are likely still locked to the AT&T network. Not to mention that you've got to already be an AT&T customer, and they're only selling one phone per line that you've already got. Which means these phones are... for Grandma, who doesn't want a contract and can't make it to the store herself? Businesses might be interested as well, we guess, but for most of us, it's still cheaper to just buy the phone and sign the AT&T contract (assuming that you actually want to use it as a phone).

What it does likely say, however, is that AT&T is expecting an iPhone hardware upgrade, and wants to clear out as much of the stock they've got now as they can (to suckers who are willing to pay more).

[via Engadget]

Here's an interesting idea for the App Store. Gizmodo posts that the new Blackberry "App World" has set a minimum price on its apps, asking no less than $2.99 for whatever you buy in there. At first glance, that's pretty rough -- there are a lot of free apps on the App Store right now that we wouldn't pay 99 cents for, much less $2.99. But then again, Gizmodo is willing to at least suggest the benefit of the doubt: maybe it's done on purpose, to get us past the scourge of the many fart and other useless apps populating the App Store. Maybe if every app is sold for $3 or more, they'll end up all being worth that much, too.

But we have to agree with Gizmodo's conclusion, too: while it would be nice if every app on the store was worth more than $3, there are definitely a few apps out there that are worth having the lower (and free) prices for. And to add to that, it's hard to believe that, even at $3, every app would strive to live up to that price -- most likely what will happen is that you'll end up with just as much crap on the Blackberry's store, except that you'll be paying $2 more for it.

Still, it's an idea. If Apple did a little price tweaking, is it possible that they could ensure a little more quality to what shows up on the store? Or, in the case of the junk that's on there now, will we just end up with higher-priced junk?

Dan Moren over at Macworld has picked up the App Store pricing gauntlet yet again. He somehow equates the iPhone's price dropping to $199 as a symbol that cheap people are shopping the App Store -- as if anyone who's interested in spending $199 on a phone can be called cheap. But he's starting from the right place: from AppCubby's donationware scheme (they sell apps for 99 cents and ask people to donate more on their site) to the Sound Grenade developer (he made a self-described "terrible" app in 20 minutes and threw it up on the App Store -- only to get hundreds of thousands of downloads), something is very weird in the world of apps for the iPhone and iPod touch.

Moren's final point seems to be that an excess of 99 cent apps is pushing the really talented developers out of business (because they can't make back what they put into the software by selling it for 99 cents), but there's still something wrong there. If someone can sell 100,000 copies of an app for a buck apiece (walking away with $70,000 after Apple's cut), why are the talented developers leaving? Surely you can make a quality app for less than $70,000, right?

We're obviously still closer to the beginning of how the App Store will eventually shape up rather than the end. It sure seems like developers who create worthwhile apps would find a way to pay for them, but if they can't, then yes, it might be worth another look at the pricing setup from Apple end.

You knew this was coming. The iTunes pricing changes announced at Macworld got groans from most of us watching (even though I'm pretty sure it's more or less agreed that it had to happen sooner or later), but the record companies are taking time to do a little bit of gloating over the fact that they've finally broken through Apple's 99 cent barrier. They told the AP that the move means that customers aren't "price sensitive" -- in other words, we're OK with paying more for music.

I don't know that that's true -- iTunes has had 99 cent songs since its inception, and even with the record companies crying and whining the whole time, it's been an amazing success. But prices go up eventually, no matter what product you're talking about, and if Apple had to raise prices, they could do a lot worse than adding a tier above and a tier below. Of course the record companies will want to put anything that sells on the top tier, but I don't think they can use that as evidence that consumers don't care what price they pay for music.

And let's keep in mind that at $1.29 a song, a 10-song album at $12.99 is still cheaper than the $16 and $17 record companies used to try and charge. There's no question about it -- this latest change is one in favor of the record companies, but a system like iTunes still seems worlds better for consumers than the old Sam Goody/Tower Records retail store system.

[via MacBytes]

Apple posted details about how much it will cost to replace the battery in the new 17-inch MacBook Pro notebooks announced at last week's Macworld Expo.

The cost works out as follows:

• United States: $179
• Canada: C$219
• Europe: €179 (including VAT)
• United Kingdom: £139 (including VAT)
• Japan: ¥19,800 (including tax)
• Australia: A$299 (including VAT)
• China: 1498 RMB (including VAT)

Apple says batteries can be replaced and your laptop returned to you the same day if you make an appointment at an Apple retail store. Otherwise, mail-in replacement will take three to four business days after the unit arrives at depot.

Apple also says that battery replacement services may be available at your local Apple Authorized Service Provider, but the prices may vary from those listed on Apple's website.

Note that Apple claims these batteries will last three times as long as conventional laptop batteries (up to five years or 1,000 cycles), and any defects in the first year of ownership are covered under the existing warranty. It's not clear whether AppleCare would cover battery replacement during the extended warranty period if it wears out, since the battery is considered a consumable item. Jared points out in the comments below that AppleCare currently does cover batteries that wear our prematurely (before the rated number of charge cycles). Just FYI, you can check the cycle count of your battery via Apple System Profiler / "More Info" in About This Mac, by viewing the Power section.

This is interesting: the prevailing argument about App Store pricing seems to be that developers are rushing down to 99 cents because apps priced there sell better (and developers say they can't fund really great apps priced there). But Mobile Orchard did a little number crunching, and their conclusion upends the whole premise: 99 cent apps don't sell any better than their more expensive counterparts. They plotted each app's popularity against its price, and while there are a few 99 cent apps out there selling better than any higher-priced app, the only real way to make the app "sell" better is to give it away for free. Above $0, price doesn't really matter than much in terms of popularity.

You could argue that Apple's 0 to 1 popularity scale doesn't tell us much (we're not looking at actual sales here, just a number Apple has given to each app in terms of downloads), but Mobile Orchard's conclusion makes sense, in a strange way: free apps, we know, are much more popular than any paid apps, and if people are willing to pay 99 cents, why wouldn't they be willing to pay more? Why should a 99 cent app sell better than an app of equal usability that costs $1.99? It shouldn't, and according to this data, it doesn't.

Very interesting. There is an exception -- in the Entertainment category, 99 cent apps do sell markedly better than the apps above them (Games, also, as you can see above, seem a little stronger in the 99 cent bar). But in the Business and Productivity categories, higher-priced apps actually sell better than their cheaper counterparts. People will pay what your app is worth, whether that's $1, $10, or even higher. The problem may be getting people to understand the app's worth in the first place (and that's where something like an App Store trial system might work), but Mobile Orchard's data says that price isn't a factor in an app's sales.

Thanks, Dan!

Last we heard from Rolando, perhaps the iPhone game we're most excited to play, ng:moco had announced that they were still aiming for a release date of "Holiday 2008." And now it's looking like that holiday is Christmas rather than Thanksgiving, because over on their site, they've put up a new video for the game, and they're now saying there will be a "December" release (strangely enough, Touch Arcade's URL for the story says "December 12th" at the time I write this, but that could have been just an error on their side).

Oh well. At least we've got the new trailer, which shows off some more of the way gameplay works, including the 2D physics, the great colors and art, and the use of the touchscreen to not only control characters, but sometimes rearrange and manipulate the game world.

Rolando continues to look impressive (rumor has it that it'll come with a $9.99 price tag, but hopefully we'll get a demo to try out first). We've waited months for the game already, so a few weeks probably won't be so bad, right?

[via Touch Arcade]

Marco over on the Instapaper blog (which, of course, is the blog of the app Instapaper), posted a really interesting commentary recently on a subject we've been following since the beginning: App Store pricing. As we've said before, it's a strange thing -- developers want higher prices so that they can put more effort into making iPhone apps better. But customers have a perception already that anything above $5 in the App Store just isn't worth it.

So Marco offers his take: he's been selling an app in the store for $9.99, and it's going just fine. He has tips for how developers can sell their own apps for a higher price, and he settles on some good compromises for everybody: deliver a real value with your app (as economists know, an app is worth what people are wiling to pay for it, so if you produce an app that is worth $10, people will happily spend that much). Respect yourself as a developer, and don't cower to cheapskates (some people won't be happy with anything, even when it's free). And perhaps most importantly: offer a free version.

That last one may be the key -- our own Michael Rose was sold on Instapaper only when he tried it out. More and more, I'm thinking that it was a major mistake on Apple's part not to allow developers to easily offer demos and upgrades in the same app -- people are willing to spend money on an app that's worth it, but not if they aren't sure, and trying it goes a long way to making sure. I'm not in favor of app store developers banding together to raise prices, but Marco is right: if you make an app that's worth $10 and put it on the App Store for $9.99 (with an easy way to demo it out), people will come and buy it.

Last spring, TUAW asked how much you would pay for iPhone software. Well, it looks like $0.99 and $1.99 are the new $39.99 and $49.99 as far as mobile distribution goes. The App Store bucked the trend of high-priced phone software and now is ratcheting those prices down even further.

Developers are responding to high application supply and dwindling demand by lowering their prices across the board. As the App Store novelty wears off and consumers forget about once-"hot" items, the typical price tag continues dropping. Games that cost $9.99 at launch are almost universally $4.99 and less.

Apps like Koi Pond proved that $0.99 can generate a lot of sales. Short term sales are quickly being eclipsed by long term price drops. We typically get our tips about upcoming price changes directly from developers; 148Apps has introduced a automated price drop detector.

As the App Store continues to evolve from "get rich quick" to make money slowly, devs are working to find that sweet spot -- charging enough to earn a living but not so much that they aren't out-competed.

Based on these downward pricing trends, I expect ad-supported apps to really start taking off soon, the way they are doing in the jailbreak world. If developers can't build their revenue stream from charging higher prices, they may turn to alternative monetizing models instead.