Rogers Hints at iPhone Pricing Plan, Still Plays Coy
by Eric March on June 16, 2008 at 12:39 pm
Us Canucks pretty much knew that Rogers will be tailoring a special data plan for the iPhone when it gets released on July 11th, but about all we’ve been able to get out of their mouth on the subject was an effective “no comment.”
Today, Rogers parted the veil — just enough to let a crack of light through but not enough to make out any detail. With Rogers’ new subscriber rates slowing and their stock prices leaking, it seems they want to let everyone know that things on the iPhone tip are going to be halfway decent. Following a press conference in Toronto, Rogers COO Nadir Mohamed told Bloomberg, “We want pricing that actually drives adoption. What you will see categorically is more value.“
Scotia Capital analyst John Henderson later said in an E-Mail to Bloomberg, “They want to drive penetration,” adding that Rogers customers would get “more for less” under the new plan.
Call me slightly bitter there, Nadir, but given current Rogers plan data rates, it would be awfully hard for you to offer less value at the moment. Cheap jabs aside, Rogers plan to announce the changes to their data rates and their tailored iPhone package within the next two weeks, which should give Canadians enough time to decide whether the plan makes the subsidized iPhone pricing worthwhile. Whatever they do come up with though, there’s a chance it won’t be a nice all-you-can-eat plan. Rogers execs have stated that they are not fans of unlimited plans like AT&T offers in the US, so you might want to prepare yourself for another round of tiered plans.
(Sources: The Toronto Star, Bloomberg)
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June 16th, 2008 at 5:21 pm
Right now I am sure there are top level meetings at Rogers saying “Okay, how much can we get away with charging without looting breaking out at our stores?”
Guarantee they’re going to gouge, gouge, and then gouge some more. Gotta keep the money rolling in so they can keep paying their whores at the CRTC…
Not that I’m cynical or anything;)
June 16th, 2008 at 6:37 pm
I’m slightly more optimistic — which is a nice change from my usual buckets of cynicism. Although I can all but guarantee we won’t see anything like AT&T’s awesome $30 buffet, we will probably see something that is at least better than their current rates — which, as I mentioned in the article, isn’t saying much. Initially I’m sure they’re going to soak the early adopters (and unfortunately I’m going to be one of them — two of them, in fact, since I’m going to pick up one for my wife on launch day) but I expect they’ll slowly ramp it down to attract more and more of the hoi polloi. I have a feeling we’re going to see something like this:
Tier 1: For the E-Mail set. 5MB @ $10/mo.
Tier 2: For the light user: 20MB @ $20/mo.
Tier 3: For the moderate user: 50MB @ $40/mo
Tier 4: For the heavy user: 100MB @ $60/mo.
Tier 5: Platinum package: 500MB @ $100/mo.
At least at first. I hope Rogers surprises me and beats my (extremely rough) estimates, but I suppose that would be a bit like hoping Big Media will realize the error of their ways and cut the world some slack.
June 17th, 2008 at 2:51 am
What I’d like to know is exactly how much usage costs THEM. I would love to know the markup on the data rate when it’s announced. I’d expect it to be at least a three figure percent hike.
Doesn’t effect me mind you. I’m still happily using my $15 every 6 week prepaid crappy Nokia phone that does little more than phone and text messaging. And even then I sometimes forget to renew it.
June 17th, 2008 at 9:02 am
I’m sure that the margin on data rates over operating costs is probably quite beefy. In fact — odd as it may sound — I hope it is, because it means there’s a lot of fat they can trim in order to bring the rates down to more realistic levels instead of being one of (if not the) highest in the developed world.
June 17th, 2008 at 5:03 pm
Yes, but will they trim the fat? The thing the iPhone lacks right now in Canada (well, aside from actual being here right now if I’m being technical:)) is competition. I think if another carrier got a similar device and there was a competition, they’d have to drop prices.
Of course that’s obvious and I don’t know why I said it now:)
June 17th, 2008 at 6:57 pm
It is speculated that this is what is partially driving Rogers to be more competitive. With the upcoming spectrum auction having 40% of it reserved explicitly for competitive mobile telecommunications ventures (which currently has some big interest) Rogers, perhaps for the first time, is facing what could become real competition. The smart thing would be to head that off at the pass instead of waiting for it to become an issue.
Not that I am accusing Rogers of being smart.
Just the same, prices will drop. The only question is how deep the cuts will be.
June 19th, 2008 at 4:41 pm
The Wireless spectrum auction will not make a new national carrier like everyone seems to think. At least not a sustainable one. the USA with 10 times more people than us is still only able to support 4 national carriers, Canada cannot support 4. We can barely support 3 as Bell Mobility is up for sale and really in the shits.
Even when some company purchases this 40% or however much they end up getting, they get to piggyback off the Rogers network for the first 5 years of operation while they ‘build their own network’. Piggybacking isn’t free though and Rogers gets to charge them for that, so their prices are going to pretty similar to the trigopoly we have now because they have to pay Rogers (or Bell or Telus if they choose CDMA) a rental fee for every subscriber, plus they need to pull in revenue for themselves to set up ‘their own network’ because if it’s not fully launched within 5 years Rogers gets to say “see yah!” and kick them off the network in which case they would lose all their customers or the more probable outcome would be that Rogers would purchase the company just like they did Microcell (fido) and eventually change all their plans back to what Rogers deems is the acceptable amount of money to pay for their services….