So back to square one - devices with great data capabilities. Unusable data rates.

I hope it'll be different in Australia with Optus, Vodafone and hopefully Telstra all getting in on it soon, but somehow i doubt it. My current corporate data plan is $30 for 5MB of data.

So once more with feeling: It's 2000 and freaking 8 and we can't use the internet on the go!!!

Joe - go talk to AT&T - if you have a current family plan it stays as is but you add $10 extra a month for the 3G data component of any 3G iPhone you upgrade to. It's not as bad as published today. The existing family plans do provide some respite.

six strings wrote: "The existing family plans do provide some respite."

I asked at a company store and got a complete blank. Maybe AT&T hasn't fully briefed the local stores. Whether or not I personally see an increase, at the least switchers are cued up to pay a lot more for Family Talk plans including iPhone 3G than those that don't have it. Same may apply to existing AT&T customers that don't qualify for discounted iPhone 3G.

Should anyone really have to pay $130 a month for a 700-minute iPhone family plan compared to as little as $85 (with $15 MediaNet Unlimited) for same plan and data for another 3G phone?

Looked at differently. The Personal Data plan applied to Family Talk 2100 brings the monthly price to $139.99, or $30 less than with iPhone 3G. That makes Windows Mobile-based AT&T Tilt--also a touch screen phone--look like quite the monthly bargain.

Joe

I really want the Iphone but can't justify it. It is a simple shame that I won't be able to have it's cool feature since I am an Apple guy. I think AT&T should look at their pricing carefully because they are leaving out whole demographics with such high pricing. The lady at AT&T said there will absolutely be no discount with the Iphone 3G so I guess I will have to look into another phone when my contract is up because I am already paying close to 120 a month for 4 lines without any media or texting, thats extra.

That's what you get from a monopoly.

If AT&T had to compete with other telcos for iPhone business, prices would drop.

We're going to have the same thing with Rogers in the fall, when they release the iPhone here.

Vote with your wallets folks. The bling isn't worth it.

Obviously, AT&T doesn't watch the news. Americans are struggling to pay their monthly bills and buy food for the family. Their losing their jobs in record numbers, and their houses are being foreclosed on. We can barely afford health insurance that keeps rising at record rates each year.

What a great time to ream everyone with exhorbitant cell phone pricing. With those rates, I'll bet people won't be rushing to get a 3G in record numbers.

Why do businesses have such a hard time seeing that the "sell more for less" model works better than the "sell less for more" one? If music CD's were $5, I'd bet piracy would all but disappear, and those "lost billions" would be in the pockets of the record companies.

This is what happens when there is a monopoly.

AT&T at this time is the only USA carrier for the I-Phone and can do anything it wants to its customers.

I am currently on a month to month with Sprint with two Treo 755p's and I was planning to switch over to two new I-Phone 3-G's next week. I pay about $150 a month for 2000 shared minutes, 500 SMS messages and unlimited data with Email and ActiveSync which I need and has been available for years.

Nope, Sorry, Not going to happen.

Many years ago Apple was so closed minded about opening up its technology, it almost went under.

You would think that it would have learned from its mistakes.

And finally, isnt there a law about monopoly's? And why has not any Governmental Agency approached Apple about its one-handedness about only having a single I-Phone Carrier?

Oh, enough with this "monopoly" nonsense, already! This situation is nothing of the sort. If AT&T were the only wireless provider in the US, THAT would be a monopoly.

Other carriers have exclusive arrangements with equipment manufacturers. So, a phone you can get from Verizon is not available through Sprint. This is not a monopoly.

If you're such a poseur that you just HAVE to have such an overblown, overpriced toy, then pay the price to AT&T and quit yer beefin'. Otherwise, get a Motorola Q for around $99 and get voice and unlimited Data for about $99 a month. Works for me.

You are missing one thing... that this new "family plan" you are quoting is an iPhone 3G 2-user family plan. It includes TWO unlimited data plans + shared minutes for TWO iPhone 3Gs. If you only have one iPhone 3G on your family plan, you still get the "traditional" family plan pricing for voice, and just add the iPhone 3G data plan.

Don't get me wrong, the old 2G is cheaper... but this 'mystery' $50 more a month you are seeing is because it's 2x 3G data plans, plus the standard shared minute pricing. Read the fine print before you blog.

MarkOne wrote: "Otherwise, get a Motorola Q for around $99 and get voice and unlimited Data for about $99 a month. Works for me."
I have a Motorola Q, and it's pretty slick. However, you still have the clunky integration with Microsoft products (Windows Mobile) onboard, versus Apple's pretty seamless solutions. That said, I don't think the iPhone is work the money, if that's what it costs to purchase, then use it. AT&T still doesn't make my list.

Joe, I know your blog is entitled AppleWatch, but what about how the Apple/AT&T arrangement is doing against other competitive options? With just about any first mover, Apple's iPhone is quickly getting some serious product competition: MotoQ, Sprint's new Instinct, etc. And Sprint, for example, has a high-speed data value that not only is much faster and more reliable than AT&T's 3G, it's much cheaper. Astute customers understand the difference between real value and fanzine-ism. It looks like the value life cycle of the iPhone is already in serious question.

I think maybe it's time that AT&T realizes that while they hold the monopoly on the iPhone; they do not hold the monopoly on cell service. I have been w/AT&T for @15 years. My loyality lives and dies with customer service. I know that w/cell service there is not a lot of difference but while there is no clear winner, AT&T/Apple can be sure losers. AT&T.....Ma-Bell....Monopolies, sound familar?

Yea, I was waiting for the Iphone and called to see the data rates before this article and already new I will not be able to have an Iphone.

Because not only is it $30 a month more does not include text messages. Have to wait until they realize they are actually loosing money with those rates and bring the original princing back.

Also did anyone confirm you can get the old $20 with text with the old Iphone if that was the case I would still be interested in getting the old one.

I was very exciting about the iPhone 3G but after AT&T published its plans, not so much. I think it is a great phone on a not so great network (when compared to coverage of some like Verizon Wireless). Don't get me wrong I think AT&T did a good job bringing the features of the iPhone to market.

I was about ready to switch to AT&T but I'm now having a difficult time justifying the higher rates. I may now wait for the competition to kick in.

Does any one know what the cancellation fee will be? Did that go up as well? I may get it for a year or so until other vendors are able to jump on board. Even if AT&T drops it rates at that time I'll remember when they took advantage of their customers just becasue they could.

At that time, will the current iPhone 3G work on vendors networks or will you be forced to purchased a new phone as well. If so, another reason to continue to wait.

My current plan is not up until December so I will be waiting to see what pricing is like then. I have a BlackJack now and absolutely hate it compared to the iPaq I used to use. The only reason I switched was because I got tired of paying $200+ everytime I cracked the screen.

I really wanted the first iPhone but not bad enough to stand in line for it and not bad enough to deal with kludgy solutions for e-mail sync with an Exchange server. Likewise, I don't think I will want an iPhone xG if the monthly rates are that much more than other devices. I'll just go back to an HP device and chew on glass the next time I break it.

I left AT&T some years ago because of their lousy service. I went to Cingular and was very pleased with the service. Since AT&T and Cingular have combined the poor service has returned. So unhappy with them.

After being happy with ATT for several years, the last has been a nightmare. Not only has our family minutes rate increase astronomically, but the data plan which was to decrease each time I have spoken with ATT Corporate only increases it. Last month was the killer blow-I was injured and my Husband and I used our phones for less than 80 minutes on a monthly of 800-no data-yet our bill topped out at over $200. I am in the process of changing companies although there are no firms in this fight with good intentions.

Hey, wait a minute! The iPhone is a luxury item, the cell phone is a luxury item. We aren't talking about gas here - this is a vountary expense. If you have to have a cell phone and have to have eMail then get a Blackberry, but for gosh sakes quit whinning. If you can afford an iPhone you can afford the service. Bunch of babies!

As far as I'm concerned, this is potentially good news, since it will leave ample room for Google's Android handset to gain market share (assuming the carriers don't pull similar stupidity in setting up Android rate plans).

Just buy the Blackberry Bold when it comes out soon. F Apple.

At & t is just doing the same old things that got them into real trouble. As for the "Outrageous-Pricing"; AT&T will atone. They will soon see when they can't achieve the projected profit margins... the market(s) have priced-in limits.
AT&T has the worst plan I have seen.
Even with their "Go-phone", it's the worst cost-per call per usage plan.
I refuse to do any business with them.

Ed, cell phone is not a luxury item. Step into 20th century. Just because, people want a decent product doesn't mean that they have to get screwed for it, does it?

I like the blog. I don't like the comments.

You don't need an iPhone to live, eat, breath, or do business. The phone is Apple's, and the service is AT&T's; they can and should price it anyway they want.

If you want to complain about the price, fine, but don't demonize the company just because you want their Ferrari at a Chevrolet price.

P - cell phones are a luxury. I'm in IT and I haven't replaced the cell phone I lost two years ago and have not "suffered" and I have zero intentions of getting another - you might find that hard to believe but that's a common reaction I've seen from people that have never tried. Just remember that commerce and peoples' lives got along just fine 20 years ago without 'em. For sure, if you're a salesman out on the road etc, a cell phone is pretty damn handy no denying, but for people like me that work in an office (and that's a fair proportion of the population), the desk phone works just fine and since I have dsl at home, I have a landline there too. Frankly, I don't need people calling me every two minutes to ask "what are you doing? Me? Nothing....."

Try it, you might like it. As for email, don't get me started there ... : )

I found this blog on a google search and boy am I glad I did. I thought I heard someone mention it in a free chat room.
Awesome read!