Cheaper iPhone Capable Of Luring More AT&T Customers To T-Mobile?

iphone-5c-packaging-blue

In a move that will likely cause T-Mobile CEO John Legere to jump for joy over another chance to hit AT&T below the belt, industry analysts speaking to Bloomberg suggest a cheaper ‘iPhone 5C’ could lure more customers away from the death star to T-Mobile.

Roger Entner, an analyst at Recon Analytics suggest that the playing field is more level than it has been in recent years and that’s good news for T-Mobile: “It’s a much more even playing field than it was last year, when AT&T (T) had more of an advantage…[T-Mobile] is in the right place at the right time with the right product.”

Expectations that Apple will announce a less expensive iPhone tomorrow along with the introduction of the iPhone 5 successor is high. Entner suggests that “getting a lower-cost iPhone could make a big difference for T-Mobile.”

While some of T-Mobile’s monthly financing plans can bring its total service cost closer to that of its competition, a less expensive iPhone could continue to make T-Mobile’s service more attractive. A theory echoed by Tero Kuittinen, New York-based head of sales and marketing Alekstra Oy, a business which helps manage telecommunication costs.

“The cheaper iPhone might fit T-Mobile’s budget plan like a glove.”

The thoughts of both Entner and Kuittinen were supported by a third analyst talking to Bloomberg who agreed with the overall sentiment of his industry colleagues. Michael Cote, an industry strategist with the Cote Collaborative in Chicago said AT&T and its larger rivals are vulnerable on cost right now:

“Assuming it is a lower-priced iPhone, it should, in theory, benefit T-Mobile more than the others,” Cote said. “If you look at the rate of people leaving AT&T for T-Mobile, the ratio is already bad, and this could exacerbate that.”

Could a cheaper iPhone, low-budget no-contract service plans and a blooming LTE network spell mountains of success for T-Mobile in the future? These analysts believe that’s a real-world possibility, but first Apple has to officially announce the lower-cost iPhone 5C.

As for how T-Mobile sees this theorem that a cheaper iPhone could lead to more AT&T customer defections, they are tight-lipped:

“We are looking forward to Apple’s announcement,” T-Mobile Chief Marketing Officer Mike Sievert said in a statement. “We plan to continue being highly competitive.”

We’ll find out everything tomorrow.

Bloomberg

 

Tags: , , , , , ,

  • Whiskers

    Depends on the price …

    • ceegii63

      yep if its not gonna be at least a $100 difference then there’s no point

      • Dakota

        I think its definitely going to be $100 difference in the retail price. But contracts may just have it at 99 vs 199. It will be interesting to see if they stop selling the old models, including the 5…Or whether they keep the regular 5 and have 5C/5/5S as the new good/better/best Personally I dont see much new in the 5S that would make me jump…just a finger print…But most users are on 2 year contracts so their 4S are up for upgrades and for them, a 4 inch phone will be a major hardware change

        • Roger Sales

          I think the retail price will be based on how much it costs to assemble, at least in part. the iphone 5 costs Apple about 207$, which means that the 5C will probably be in the 100-150 ballpark range if they intend on selling it at huge profits.

        • kalel33

          That’s $207 just in parts. That doesn’t count shipping, warehouses to store, manufacturing, and ads.

  • Deadeye37

    If they can run a deal on a low upfront price, they would do good. If they could manage to do a lower overall cost of the phone, like they did when they first got the iPhone 5, they can make huge gains in customers!

    • Dakota

      IF carriers offer the 5C at 99 with contract, TMobile should run a promotion for 0 down – walk out of the store with on money down. It depends on the price. Most analysts these days say Apple wont match Google Nexus pricing of 299-349 and expectations are over 400 but hopefully keep under the 500 price for the 16gb version. Imagine if Apple would not increase phone prices but make the standard now 32gb…Wont happen but probably could do it without a huge hit to the bottom line

      • Roger Sales

        Even if the phone is in the 400 range, It’ll be low enough for T-Mobile to offer it for no money down whereas it will be 50-99$ on every other carrier. Because people can more easily visualize the money they save by switching to T-Mobile, if you live in an area with adequate coverage it’s a no brainer.

        • kalel33

          I’d wager a pretty good sum of money that the Iphone 5C isn’t below $500. We’re talking about Apple here. They know they’ll sell lower grade products, at very profitable margins. Look at the Ipad Mini. That shouldn’t be over $225 but it still sells like crazy.

        • Roger Sales

          There is a precedent though, the iPhone 4(which is 2 years old) is marked at 450. If they want to really compete in the mid range market, then they will have it around this price so carriers can actually sell the damn thing.
          A lot of people think that it’s a dumb move and will take away from their marketshare, but true fanboys and loyalists will always spend top dollar to get the latest and greatest. the 5C is a move to get the attention of people who would consider an iPhone but don’t because it’s too expensive, and hence shift over to devices like the Galaxy Exhibit, Kyocera, Huawei, LG, etc.

        • kalel33

          Not much of a precedent. The sad part is that Apple is able to sell a phone for $450 that is well over 3 years old. That’s like Samsung being able to sell the Samsung Vibrant or HTC selling the Mytouch 3G slide for $450. Anyone that’d pay that much for an old as hell phone is a sucker and Apple knows there’s a lot of suckers out there.

  • James

    Anyone in Bellevue will tell you that no one chooses a phone company based on phone availability!!!

    • John

      Then the people in Bellevue are don’t have a clue and are the reason why it took so long to get the iPhone in the first place. Perhaps you should look at what happened to the att customer base when they first got the iPhone and rethink that logic.

      • kalel33

        It took so long to get the Iphone because T-mobile wasn’t going to take the massive subsidies that have killed the other carriers when they started carrying the Iphone. Once they were able to sell it at full price, and not have to subsidize them, then that’s when they were able to carry it.

        • superg05

          He ignored those reports i-blind

  • JaswinderSinghJammu

    I would get a iphone C for my secondary device if it had LTE

    • cheeto0

      Why, better off with the nexus 5

      • JaswinderSinghJammu

        You are right. I have never bought anything Apple except for Ipod nano for an ex a few years back but that’s all. I was just thinking from a price point but hopefully Nexus 5 is priced really good like the Nexus 4 but with LTE

      • Brian T.

        How can you say that when we have nothing more than purported leaked/unintentional pictures of each?

    • Brian T.

      I’d be pretty shocked if it didn’t have LTE.

  • Cybersedan

    This could be very good for T-Mobile and even the Metro PCS brand overall

  • willietturner

    I’m definitely switching from AT&T to T-Mobile

  • Dakota

    Yes it could…Depends on price and especially how Tmobile markets it. Compare your LTE and especially your MONTHLY RATES…and truly UNLIMITED DATA and what you can do with that (from iTunes radio, streaming, Netflix etc, no SHARE plans)…No more people living in shoes or Frankensteins. Their ads so far have been really disappointing compared to the competitive ads Verizon and Sprint have been airing.

    • dontsh00tmesanta

      250 for nexus 4

  • prasad

    Anything over $375 is deal breaker for me…

    • Nearmsp

      Go for Nexus. iPhone 5C will be outside your budget.

    • kalel33

      If the Iphone 5 is already over $600, so I would wager the Iphone 5C won’t be under $500.

  • Azalea Smith

    I think more people would switch over to T-Mobile if they could get better service. If you live in a rural area and you decide to switch because of the cheaper Iphone or prices. What good is it if you can’t even use it? That’s the problem that i’m facing. I live in a very populated area so the service is great but then I went off to college and it’s a more rural area i’m lucky if I get signal at all! If T-Mobile wants more customers they should work more on their coverage. Because I’m thinking about switching carriers so I can actually use my phone while i’m away at school. And not just when I’m home for breaks.

    • rfgenerator

      Yup. I just left T-Mobile (after 8 years) and went over to AT&T. Didn’t really like paying more but just got too frustrated with seeing EDGE/GPRS in much of Central Massachusetts. If after a couple years with AT&T, I find that T-Mobile has improved their data coverage issues, I would certainly be open to returning.

      • Spanky

        Same here. I left T-Mobile in 2012 after 7 years with them. Of course, I’d rather not pay more money, but the data coverage in my area was horrible.

  • Nearmsp

    Other than attracting on price, T-mobile should be focusing on quality and USP’s such as Wi-Fi calling. I would rather be proud to be a T-mobile customer for the quality and not just price. At the very least Wi-Fi calling is needed and better signal coverage. I am traveling this week and frustrating to see “G” on my cell phone all the time.

    • T. Allen

      TOTALLY AGREE. That has really been the most frustrating thing for me. I am by no means saying my GS4 is a bad phone. Not at all. But I had to give up my iPhone 5 for it for one thing….WiFi calling. The fact that it is not featured on the iPhone was dealbreaker for me. They are supposedly bring FaceTime Audio in iOS 7, which essentially is WiFi calling but only to other iOS devices. Everybody doesn’t own or want an iPhone, so granted they are making progress toward WiFi calling, but aren’t quite there yet to open it up as Android has. I can only hope. Got my fingers crossed as I tune in for the announcement later today.

  • MikeParker

    I am not convinced that Apple has any plans to sell an iPhone 5C for a dramatically lower price – in the US at least. As a company, Apple is feeling pressure to protect their profit margins and their image, and we only have to look as far as the iPad Mini to see that Apple isn’t too keen on getting into competition over price. If anything, I think Apple is making the 5C with cheaper materials so they can increase their profit margins and possibly so they can more easily tap into the growing mobile market in China – not to reduce the price dramatically for the rest of us.

    I guess we will have to wait for tomorrow’s announcement to find out the details…

    • Pirka

      If they want to get into China and India to get the middle class then they have to reduce their price to at least $400.

  • Brian T.

    Man, if they price it at $399, it’d only be $16.67/mo. with no money down…

    • kalel33

      I really don’t see Apple pricing it that low. Look at their Ipad Mini and how expensive it is against the competition, even though it’s components are low grade.

  • 21stNow

    I hear other analysts speculating the the iPhone 5C won’t be available in the US, but in emerging markets only. So none of this may be a real option, anyway.

    I don’t see a low-cost, but full price iPhone pulling people to T-Mobile from AT&T when people can be on AT&T with a two-year contract and get the iPhone 4S for free (after the 5S is released).

    • Roger Sales

      I disagree. The 5C might be touted as low end, but it has a bigger screen and relatively same functionality as a 4S. Add in the fact it is much more practical in terms of wear and tear and this is a solid option for both adults and teens who have a taste for the brand, but are accident prone. Also, the 5C will most likely have access to the delicious 4G network known as ‘LTE’, which for anyone that’s lucky to have it is far beyond even the most advanced of HSPA+ networks in use.

      I used to think that AT&T and Verizon had reasonable price-points for more coverage until they threw out unlimited data. 110$ for a single line with 4GB and no hotspot? At least T-Mobile gives you the option of slower but overage free internet on their lighter usage plans, and they let you use your data as you want – not as they prefer.

      I’m considering getting an iphone 5C for my sister because I’d only be paying 30$ for an additional line, plus what the financing of the phone which at worst will be a very reasonable 20$. AT&T, Verizon, and Sprint just don’t have anything that comes close to a comparison.

      • kalel33

        All Verizon Share Everything plans include mobile hotspot.

        • dontsh00tmesanta

          With capped plans PSH all about the unlimite with trevemod

  • KingCobra

    If it’s something like $400 full price and T-Mobile can sell it for $0 down then it will be big for them. Very big. That would mean even the customers with bad credit could walk out with a new iPhone for $200 upfront. If Apple prices it at $400 I could even see T-Mobile possibly adding another 600K-800K customers in the quarter.

    Also they could do $99 down and charge $12.50 per month. This makes the overall cost of the rate plan cheaper. Lots of options for T-Mobile to go after the other carriers with the 5C.

    The way the Uncarrier plans work, the cheaper the overall cost of your phone, the better you make out over the course of 2 years.

    Now the big question is will Apple play nice with the price? Will it be $400 or $500?

    • MikeParker

      Based on the $99 contract price for the 5c, it looks like the base model 4s will be coming in at $550. No big surprise, if you want to get an iPhone under $500 you will have to get the two year old iPhone 4s.

  • doowap

    Oh right because people that use T-Mobile are generally poorer and can’t afford to have the best coverage like At&t or Verizon customers can. Thanks for clearing that up….

    • Jack

      your an idiot i have seen some millionaires use Tmobile

      • JBrowne1012

        If I’m not mistaken there is a bit of sarcasm in his post

      • grammar police hahahaha

        you’re, not your, the idiot, sir.

    • Jerome

      Your ignorance speak for you. I am very well off and have Tmobile. That’s why Iam well off because I know how to save. Stop acting like a child. Those are statements I use to say in middle school. Oh wait maybe that’s where you stop going to school!!!!

  • Dakota

    Tmobile got snubbed in the announcement as Apple said the 5C will be 99 for 16g and 199 for 32g ON CONTRACT but no word on off contract price…Guess Apple forgot that Tmobile sells ipHOnes offf contract

    • Mirad77

      Why would anyone say its cheap? HTC one is $99 down, N4 is cheaper. Guess for some specs don’t matter as name brand do.

      • Dakota

        CNET is now reporting that the 5C will be $549 OFF CONTRACT. Thats not very cheap for people paying full price. Tmobile is going to at least have to do a $99 down to match the contract carriers…esp since the 5C will prob be 199. If theyre smart, theyll do a free downpayment for the 5C and 99 for the 5S. APple’s naming structure though sucks and is going to be so confusing…4S/5S/5C (and why not drop the 4S and have an 8gb version of the 5? Prob cuz its the same as the 5C?)…Even the guy who helped Steve Jobs name products was on Bloomberg saying the naming doesnt make sense…Why not go with the 6 vs making it seem like its a small upgrade from the 5. Kinda like Android doing 4.4 vs 5 but I guess people may say gimme a break to the kitkat

    • Michael

      off contract the 5c will be $549 according to the apple website.

  • JJ

    $549 for 5C

    • Dakota

      Not much a savings…Isnt that just $100 cheaper? Thats also the difference between the contract prices. If you cant afford $100, you probably cant afford the thousands of dollars of a 2 year contract. Pretty disappointing for a low cost phone. I wonder if its going to be priced lower in developing countries. Analysts kept saying it needed to be around $400 for china

  • IRIE4IPIEIR

    Who would really want one of these? Glad majority of store reps recommend Android devices to iOS to customers. Every time I’m in either T-MOBILE, AT&T, Sprint, Verizon or Best Buy, I always over hear a rep explaining to a customer why they should up this Android phone or tablet over the iPhone or ipad. Sad thing is this POS 5C along with the other POS 5S will sell like crazy, for a few months at least. Then it will slow. Eventually the rest of the remaining sheep will catch on to Apple and switch as well. My sister has a family of 9, a year and a half ago they all were using iPhones. Now they are using Android. My sister was thee biggest Apple person alive and she was the last to switch. Love it. Suck it Apple.

    • Asael Delgado

      I have a few friends that work at AT&T, and Verizon. Mysefl, I work at Best buy and we get better commission off of Android. “Opinions expressed are solely my own and do not express the views or opinions of my employer.”

  • awatt

    Cheaper? Yes. Cheap no. I doubt this will make any impact on AT&T customers jumping ship. Apple doesn’t believe in selling cheap stuff. This should come as no surprise to anyone. Remember, no one said it would be CHEAP everyone said it would be CHEAPER… Apple did that. No one likes the thought go check their stock AAPL.