$4,800 Bill for Turned-Off iPhones

Last month I told you about the fellow who, misunderstanding AT&T’s international data plan and the amount of bandwidth the iPhone actually uses, ended up with a $3,000 bill after a couple of weeks overseas. Many felt unsympathetic, saying he should have known what the charges would be since AT&T was up front about the cost and he was responsible for how much data has was using.Well now the story gets a little stranger: A family with three iPhones went on a Mediterranean cruise with their gadgets, but didn’t even turn on the iPhones during the trip. When they got back, a $4,800 bill for international roaming was waiting for them. How? Because the iPhone, according to this Newsday story, checks for service updates and email whether it’s turned on or off.

Sure enough, the fine print on AT&T’s web site agrees: “Substantial charges may be incurred if phone is taken out of the U.S. even if no services are intentionally used.”

But still, nearly $5,000 in charges for a phone that isn’t turned on feels, well, a bit excessive. And stories like this are piling up to the point where class-action lawsuits are in the works, alleging that Apple (and AT&T, I assume) did not do a good enough job at informing consumers how much they’d have to pay if they stepped foot out of the country.

Memo to AT&T: Isn’t it time to offer some real, unlimited international data plans for the iPhone? You know, like the ones you offer for all the other phones you sell?

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Apple Upgrades iPhone

steve jobsSteve Jobs isn’t usually one to bow to his critics, but give Apple credit for addressing two major flaws on the iPhone before it goes on sale on June 29.

Apple (nasdaq: AAPL news people ) said Monday that the iPhone will now come with a battery that supports up to eight hours of talk time, three hours more than previously announced. Apple also said the new battery could support up to six hours of Internet use, seven hours of video playback or 24 hours of audio playback.

Apple’s battery received harsh criticism (see ” Why You May Not Want An iPhone“) because early indications suggest that it can’t be removed and replaced with a fully charged spare, like consumers can do with competing smart phones from Palm (nasdaq: PALM news people ), Motorola (nyse: MOT news people ), HTC and Research In Motion (nasdaq: RIMM news people ).

Apple also said Monday that it is upgrading the iPhone’s screen from plastic to optical-quality glass, which should improve durability and prevent scratching.

While the upgrades address the iPhone’s two biggest flaws, critics still question Apple’s decision not to support carrier AT&T‘s (nyse: T news people ) fastest “third-generation” (3G) data network, instead requiring users to access a slower, older network.

Jobs says he expects to sell 10 million iPhones worldwide by the end of next year.

Forbes

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Google+Apple=Goopple?

Google, meet Apple. Apple, meet Google.

Oh, you two already know each other? Great! Time for the two of you to hurry up and tie the knot, then. Or at least start working together.

It’s easy to see why tech fantasists root for a future tie-up between the two companies. Their fan bases would view a Google (nasdaq: GOOG news people )-Apple (nasdaq: AAPL news people ) collaboration like a super group, all-star sports team or celebrity romance–all in one.

And the children would be beautiful. Imagine a Google integrating its search prowess deep into Apple’s slick operating system. Or iPods that come loaded with Google maps, plugged into a wi-fi system powered by the search giant.

In Pictures: Google + Apple = ?

Or lower your expectations, and simply imagine what would happen if Apple integrated Google’s YouTube into the Apple TV product it shipped this spring. Suddenly the device, which has received respectful reviews but little buzz, becomes much more compelling.

So how realistic is a joint project? On the one hand, Apple Chief Executive Steve Jobs is famously devoted to controlling whatever product his company releases. On the other, the two companies have already been flirting for quite a while. Last year Google Chief Executive Eric Schmidt joined the Apple board, and Genentech (nyse: DNA news people ) Chief Executive Arthur Levinson also sits on the boards of both companies.

Granted, a seat on the board doesn’t guarantee anything beyond a seat on the board: Oracle (nasdaq: ORCL news people ) chief executive Larry Ellison sat on Apple’s board until 2002, and his spot didn’t result in a slew of Oracle-inspired Apple gadgets.

But Schmidt has a habit of raising expectations of some kind of collaboration with blog-stoking quotes like, “Google and Apple are doing more and more things together through the normal course of communications. … We have similar goals and similar competitors.”

Listen to the Google guys and you figure it’s already a love affair. A group of Apple devotees from Google recently made a visit to Apple’s campus to gawk and eat lunch. After a chance sighting of Jobs at the salad bar with industrial design guru Jonathan Ive, the Google guys were floored. The official Google blog says it all: “Our Google group and many other folks stopped eating long enough to follow the two rock stars around the room for a while.”

Apple has already made a Google search box the default search engine of choice in the Safari browser that comes with all Mac computers.

Further Google-Apple collaborations seem inevitable, and AppleTV plus YouTube content partnership is only one of the possibilities. We’ve wracked our brains to come up with the most desirable, lucrative and fanciful offspring the two companies could create. You won’t find a Google-Apple mobile phone on our list. That’s because it’s already here–the upcoming Apple iPhone will already feature integrated Google maps and search. Of course, Yahoo!‘s (nasdaq: YHOO news people ) also onboard the iPhone with a mal application, thus diluting potential for Google-Apple phone branding.

Neither do we think Apple’s iTunes store will be filled with Google advertising any time soon. If Jobs wanted to make money that way, he would have done so long ago, we figure.

Instead, we’ve listed combinations that follow both companies’ paths down the road a little bit, and a lot. Google’s got a robust desktop search product while Apple has the less functional Spotlight tool in Mac OSX. We imagine Google’s desktop offering integrated into Apple’s operating system. On the wilder side, Google’s got in-Game advertising through recent acquisition AdScape, while Apple is reportedly recruiting game-design students. Could the iPhone or another platform become a Google-supported gaming system? Even further along, we can see the makings of a sight-seeing product for tourists based off GPS-powered iPods that take advantage of Google maps.

Why not? Stranger things have happened. What at one time seems impossible from Apple, can indeed become a reality. Who would have ever thought that Macs would one day run Windows, or Intel (nasdaq: INTC news people ) chips? And against all odds, the iPhone turned out to be real, and it’s almost here.

Forbes

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YouTube Calling

Apple‘s iPhone partnership with Google was extended beyond maps Wednesday and into video, one of the big-screened telephone’s most promising functions. When the iPhone launches on June 29, it will feature a built-in player for Google’s YouTube videos.

A YouTube button on the phone’s home screen will enable wireless streaming of an initial 10,000 videos, recorded in a special battery-reserving format. iPhone owners can use WiFi connections to watch clips, or they can attempt to rely on AT&T‘s (nyse: T news people ) less than speedy EDGE data connection.

The iPhone-YouTube deal emphasizes the end of an exclusive partnership YouTube made in November 2006 with Verizon (nyse: VZ news people ) to share videos with that company’s customers. On Sunday, YouTube launched a limited mobile site accessible by anyone. (See: “Not Quite YouTube To Go.” )

On May 30, Apple (nasdaq: AAPL news people ) announced a deal with Google (nasdaq: GOOG news people ) to bring YouTube content to its Apple set-top television box. That deal, in addition to the inclusion of Google’s mobile maps and YouTube software on the iPhone, show the two companies are eager to partner up. (See: “Brought to You By Goopple.”)

“Now users can enjoy YouTube wherever they are,” said Apple Chief Executive Steve Jobs. “On their iPhone, on their Mac or on a widescreen TV in their living room with Apple TV.”

The iPhone’s YouTube program was built by Apple, not Google, signifying the company’s intentions to limit access to the phone’s operating system. At the company’s Worldwide Developers’ Conference earlier this month, Apple told developers they’d be allowed to develop applications for the iPhone that ran inside a Web browser, rather than on the phone itself.

Forbes

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Real Cost of iPhone: Service Plan Revealed

At long last the final shoe on iPhone has dropped: The cost of voice and data plans that you’ll have to buy from AT&T when you purchase the device. The good news: It’s not as bad as some had feared. The bad news: It’s still going to cost you a pretty penny if you’re used to paying $40 a month for a basic service plan.Here’s the damage: $60 a month for 450 minutes. $80 for 900 minutes. $100 for 1350 minutes. If you need even more minutes, plans continue to climb up to $220 a month for a whopping 6000 minutes. The good news: All plans include unlimited email and web, rollover minutes, unlimited mobile-to-mobile, and 200 text messages a month. All except the cheapest plan include unlimited nights and weekends minutes; the cheapest plan includes a mere 5000 of those. Contrary to earlier rumors there is no voice-only option for the iPhone: Remember you need data service to do all the cool email/web/mapping business that makes iPhone an iPhone, otherwise you’ve pretty much got a pretty brick in your pocket that can play Avril Lavigne tunes. Additional details are here.

Is this a good deal? Let’s compare. AT&T’s cheapest voice-only plan costs $40 a month for 450 minutes, 5000 nights and weekend minutes, and no data services at all. (Even text messages are about 15 cents a pop.) Adding $20 a month for unlimited web isn’t a bad deal. For the $60 of the iPhone’s cheapest plan, you can get AT&T’s 900-minute plan with no data service.

Looking at it another way, AT&T’s Messaging Unlimited plan (unlimited MMS/SMS messages) costs $20 a month extra. Its unlimited messaging and media plan (which gives you access to cellular video as well) costs another $40 a month. The company has a variety of data plans for web browsing phones. The closest to what the iPhone gets you is SmartPhone Max, at $30 extra per month.

Whew, that’s a lot of numbers. Putting it all together, designing a comparable plan to iPhone’s $60 service on AT&T with a non-iPhone device would actually cost about $70 a month. Believe it or not, iPhone service is actually a bargain!

On the other hand, $60 a month or more isn’t cheap. Over the life of the phone that equates to $1,440. Add in the price of the phone and activation fees and the cheapest amount you’ll spend on an iPhone over the next two years is $1,975. You can almost buy a brand new MacBook Pro for that outlay. And don’t forget the cancellation fee you’ll pay on your old phone…

Overall I’m pleased. AT&T could have gouged consumers with a $100/month plan and few people would have flinched. Instead the company is offering an affordable option that should help to ease the sting of that initial $500 or $600 outlay. That said, I’m sure many will still find the plan too expensive. As always, I await your thoughts, opinions, and rants on the topic.

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Apple Limits Customers To 2 iPhones Per Buyer

iphoneSeattle (dbTechno) – Apple has made the announcement that they are making a stand to try and stop iPhone buyers from purchasing the devices just to resell them by limiting the number of phones buyers can purchase to just two iPhones.Apple also stated that they will no longer accept cash when selling the Apple iPhone.

Apple kicked off this new policy last week in an attempt to try and stop the reselling of the iPhone on auction locations such as eBay.

This was a huge cut from the previous maximum which allowed buyers to purchase up to five iPhones and had no restrictions in place as to how they could pay for them.

Apple believes that many buyers were purchasing the iPHone to modify or unlock them and then resell it online at a premium price point. Apple recently stated over 250,000 iPhones have been unlocked to work on other networks besides the exclusive AT&T network Apple has a deal with.

How this will have an impact on iPhone sales remains to be seen but it is clear that Apple is dead serious about fighting the unlocking of the iPhone and reselling of the device as well, even if it means they may lose some sales to resellers.

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Why Apple Doesn’t Want You to Unlock Your iPhone

So why does Apple care if those iPhones are unlocked or not? Well, The New York Times brings up another good point. Nobody really knows just how much AT&T pays Apple for each activated iPhone on its network, but because they have to report this “deferred revenue” to investors, one analyst thinks he’s figured out the math.

Gene Munster, from Piper Jaffray, thinks AT&T is paying Apple $18 a month for each activated iPhone. That’s $432 for every two-years it’s on the network. Add the cost of each iPhone to that figure, and it appears Apple makes at least $831 on each iPhone it sells (less for the cheaper model). If in fact, there are over $250,000 unlocked iPhones working on other networks, that means Apple is potentially losing millions of dollars.

And so now we get a better picture of why they have been so active in cracking down on hackers and unlockers. I understand the unlocking part, but I don’t understand why some of the other applications have been disabled.

I think this iPhone unlocking business has brought to light a bigger problem, and this conversation is just getting started. As a matter of fact, earlier last week, Walt Mossberg from the Wall Street Journal wrote a post titled “Free My Phone” in which he says:

A shortsighted and often just plain stupid federal government has allowed itself to be bullied and fooled by a handful of big wireless phone operators for decades now. And the result has been a mobile phone system that is the direct opposite of the PC model. It severely limits consumer choice, stifles innovation, crushes entrepreneurship, and has made the U.S. the laughingstock of the mobile-technology world, just as the cellphone is morphing into a powerful hand-held computer.”

Strong words, but they’re true. Check it out, it’s a good read.

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