AT&T Revises iPhone 3G S Upgrade Policy

We all know the deal with device upgrades: Unless you’re a new customer or at the end of your contract, upgrading to a smartphone will usually cost you a lot more than the $199 advertised, after-rebate price. However, AT&T Inc. today said it would break with that industry reality for certain customers who want to snag the iPhone 3G S right away.

The carrier said in a customer letter that those who will be eligible for an upgrade in July, August or September will be able to get the “best upgrade price” now.

AT&T is bowing to pressure from iPhone customers who were not happy, not happy at all to discover that they would spend $200 more unless they were upgrade-eligible (a status that varies per customer according to months into the contract length and monthly ARPU – those that spend more are eligible earlier). Chat rooms filled with disgruntled iPhone users begged the carrier to reconsider.

“We’ve been listening to our customers,” the letter reads. “And since many of our iPhone 3G customers are literally weeks shy of being upgrade eligible due to iPhone 3G S launching 11 months after iPhone 3G, we’re extending the window of upgrade eligibility for a limited time.”

Those that qualify and have already preordered the iPhone 3G S from an AT&T store will have the price changed at pick-up. Those that pre-ordered online will receive a credit.

Otherwise iPhone users will pay $399 (16GB) or $499 (32GB). Customers can also pay full retail – and not have to sign a 2-year contract – at $599 (16GB) or $699 (32GB).

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