AT&T Considers Drop in iPhone 3.0 Plan Pricing

In a move to preserve the exclusive relationship with Apple and increase iPhone sales, AT&T may be considering changes to iPhone data plan pricing with the introduction of the next generation device. A typical two-year contract would see a price decrease of $10 per month, bringing the cost back to what original iPhone users signed up for in 2007.

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Market research has shown that the high monthly cost associated with iPhone contracts may steer some users away from purchasing the device. The minimum cost over the required two-year contract amounts to over $1700 not including text messaging, taxes and fees.

The new $20 data plan could have bandwidth limits, however. The current $30 plan is unlimited. Surveys have shown that 43% of existing iPhone users make over $100,000 annually, and that there are fewer of these consumers remaining to hop on the iPhone bandwagon.

New subscribers to AT&T in the first quarter of this year dropped 5.6% from numbers in Q1 2008. Other options to increase smartphone market share are also on the table, according to reports.

AT&T could sell the iPhone hardware with a higher subsidy, or offer a prepaid service contract. Manufacturing costs are decreasing for Apple, so a less expensive device is not out of the question. Dropping the up-front cost of the iPhone to $99 would certainly increase the number of interested consumers.