Existing AT&T iPhone customers who are in the middle of their two-year contract with AT&T and want to upgrade to the new iPhone 3GS may have to pay $200 more for the phone, and some of them have taken to Twitter to protest the price difference.
The new phone, which goes on sale June 19, will cost new and "qualifying" customers $199 for the 16-gigabyte version and $299 for the 32 GB mode, says AT&T, the exclusive carrier of the popular smartphone in the United States.
Surprised and angry AT&T customers have been venting on Twitter, the microblogging Web site where, as of this morning, nearly 4,000 of them signed a "Twitition," a Twitter petition protesting the pricing.
"We the undersigned petition AT&T to offer reasonable iPhone 3GS upgrade prices," the petition says.
Among some of the comments: "You're killing any brand loyalty you have," "Why do I have to pay $200 extra bucks to get out of 1/3 of my subsidized time? If you charged us $66 extra, I would understand," and "So much 4 maintaining cust loyalty."
AT&T, which like many companies, has a presence on Twitter at @attnews, tweeted that "We are listening to chatter on concerns on iPhone upgrades and pricing," and referred customers to a "pricing and upgrading FAQS" downloadable file.
Included in the q-and-a: "Why aren't you rewarding your current iPhone 3G customers with the 'best available' pricing?" The answer: " 'Best available' pricing, or pricing that's available to new and qualifying customers, refers to subsidized pricing where carriers pay manufacturers for the device, but only pass along a portion of that cost to the customer. This way, customers can enjoy their premier device for a much lower upfront cost, while the carrier recoups the cost during the term of the agreement.
"That's what we did with iPhone 3G last summer and what we're doing with iPhone 3GS. AT&T did not offer a subsidized price for the original iPhone in 2007, which is why we could offer these customers the lower, subsidized cost just one year later."
"Qualifying customers," AT&T says on its Web site, are those "that qualify for an upgrade. Upgrade eligibility varies with each customer but in general you will become eligible the longer the tenure in your service agreement."
The company advises customers to check upgrade eligibility by going to att.com/iphone. If a customer doesn't qualify for an upgrade, the cost is $399 for the 16 GB model, and $499 for the 32 GB phone.
The new iPhone 3GS, which should be about twice as fast for Web browsing and e-mail as the current phone, and include a video camera, compass and voice control, was announced by Apple Monday.
The company also said its 8 GB version of the iPhone 3G — the current phone — was being offered immediately by AT&T for $99, a price drop of $100. The 16 GB iPhone 3G, which has sold for $299, drops to $149, but once it's sold out, will not be available again.
That pricing also applies to new and qualifying customers. Those who do not qualify will pay $299 for the 8 GB phone and $399 for the 16 GB phone.
AT&T also lists pricing for customers who do not want to sign a contract with AT&T. It is $699 for the 32 GB iPhone 3GS, $599 for the 16 GB version, $549 for the 16 GB iPhone 3G and $499 for the 8GB iPhone 3G.
Apple has Monday it has sold more than 40 million iPhones and iPod touches since the devices were first released nearly two years ago.