AT&T iPhone 3G pricing, upgrade, calling/data plan policies revealed - no more revenue sharing

Assuming the documents are on-point, we now have some more insight into AT&T’s policies regarding iPhone 3G purchase, upgrades, and subsidies.

Some iPhone owners will get free iPhone 3G replacements
If you are a current iPhone customer, and you bought you first-generation iPhone on or after May 27th (despite widespread expectation that Apple was going to release a new iPhone in a couple weeks’ time), then you’re in luck. AT&T will trade-up your iPhone to an iPhone 3G gratis - that’s right, if you purchased your iPhone on or after May 27th, you’ll be getting an iPhone 3G for free. If you bought your iPhone on May 26th, sucks to be you, give AT&T customer service a call.

Most iPhone owners in good standing will be eligible for the upgrade/subsidized iPhone 3G pricing
For the rest of us that bought an iPhone during its early days on-market, we can still get in on the iPhone 3G action at the new, lower price-point. AT&T will be allowing any current iPhone customers, in good standing (you did pay your bills, didn’t you?), to buy a new iPhone 3G at the subsidized price of $199 for the iPhone 3G 8GB or $299 for the iPhone 3G 16GB.

Of course, you’ll have to sign-up for a new 2-year contract with AT&T. Whatever time you have left on your AT&T iPhone contract will be nixed and replaced with a new 2-year contract from AT&T.

No more pre-paid AT&T GoPhone plans for iPhone 3G
It looks like the iPhone 3G will not be getting any pre-paid love from AT&T. The AT&T GoPhone plans for iPhone will not carry over to the iPhone 3G. That means that any new iPhone 3G hopefuls will have to pass a credit-check and sign-up for a 2-year contract to get their hands on an iPhone.

New iPhone 3G unlimited data plan - $30/month
Thats’ right, with higher data speeds, AT&T will be charging higher data fees. Whereas the first-generation iPhone was blessed with a relatively cheap $20 a month unlimited data plan, all iPhone 3G hopefuls will have to sign-up for a $30/month unlimited data plan - the $30 iPhone 3G unlimited data plan must be added to qualifying calling plans. Business users can expect to add $45 on top of their calling plans to get unlimited data on their iPhone 3G.

Apple and AT&T activating iPhone 3G in-store
So, what’s to stop any new iPhone 3G buyer or upgrader from just taking their newly purchased iPhone 3G home and popping in their existing SIM card? Well, AT&T and Apple will apparently be activating all iPhone 3G handset in their respective stores. Remember, to get the subsidized $199 or $299 price on the iPhone 3G, you’ll have to sign a new contract anyway, so this is just AT&T and Apple’s way of making sure you pay more for the new data plan and don’t go about unlocking the handset for sale on the gray-market.

30-day trial period
AT&T is allowing iPhone 3G hopefuls a 30-day trial period. Anytime within the first 30-days of the iPhone 3G’s activation, the customer can return the handset and have their service immediately terminated. Contract termination within 30 days will not incur an ETF (Early Termination Fee), but after day 30, you’ll be paying through the nose to cancel your iPhone plan.

If you cancel on or before the 30th day of iPhone 3G activation, you must return the iPhone 3G handset. If you cancel after that magical 30-day mark, you’ll be allowed to keep the iPhone 3G handset, but keep in mind that you’ll be paying a hefty ETF.

From the AT&T memo:

To cancel service within the first 30 days, the customer must return their equipment to the place of purchase (no exceptions). If the customer cancels service after 30 days, they will be charged the ETF. The customer is not required to return the device to cancel after 30 days.

No more revenue kickbacks to Apple
With the iPhone 3G subsidized to that incredibly affordable price-point, AT&T will no longer be making revenue kickbacks to Apple. As you may recall, the iPhone was originally launched without subsidy and with Apple demanding a revenue-sharing deal where AT&T pays a portion of iPhone-related revenue back to Apple.

Now that we have an iPhone subsidy in the open, the revenue-sharing model that drew so much criticism has been nixed.

Jump the break to take a peek at the leaked AT&T documents.

***Confidential AT&T Information. For Internal Distribution Only.***
AT&T and Apple today announced that the iPhone 3G will be available in the U.S on July 11. iPhone 3G combines three products into one small, lightweight device: a revolutionary mobile phone, a widescreen iPod, and it puts the Internet in your pocket with the best e-mail, web browsing, search and maps applications ever on a mobile phone.

The new version of the iPhone harnesses the power of AT&T’s broad and powerful 3G mobile broadband network, which offers 3G mobile phones download speeds of up to 1.4 Mbps.

Key Device Features:

Operates on Wi-Fi, EDGE, and 3G networks
New enterprise e-mail capability with support for Microsoft Exchange ActiveSync
New iPhone software development kit (SDK) to support new innovative applications
Note: 2G iPhone customers will be able to download the iPhone 2.0 software from iTunes which enables new features such as access to corporate e-mail via Microsoft ActiveSync.

New Activation Process and BRE:
The iPhone 3G will be activated at point of sale when the device is purchased, in store. The BRE period will change from 14 days to 30 days and will require the device to be returned to place of purchase before service is cancelled.

Pricing and Plans
Device Pricing:
$199 8GB and $299 16GB for new activations and qualified upgrades with 2-year agreement.

Data Plans and Pricing:
The iPhone 3G will be activated on existing AT&T voice rate plans, but new data plans have been created for the 3G device.

All iPhone 3G customers are required to have one of the new data plans and qualifying voice plan.
Customers intending to use the iPhone 3G for access to corporate e-mail, business applications, or access to corporate intranet are required to activate with Enterprise Data Plan for iPhone.
The 2G data rate plans will remain available for 2G devices until further notice.
IRU service discounts for both voice and data pans will apply to iPhone 3G, but not 2G iPhone.
CRU service discounts for voice and data will apply to both 2G and 3G, when on a qualifying data plan.
IRUs will not get a discount on device purchase for 2G or iPhone 3Gs.
Data Pricing will be as follows:
Consumer Data Plan (must be added to qualified voice plan):
$30 - Unlimited Data (E-mail/Web), includes Visual Voicemail

Enterprise Data Plan (must be added to qualified voice plan):
$45 – Unlimited Data with personal and corporate e-mail, web, includes Visual Voicemail

Upgrade Eligibility and Qualified Upgrade Pricing
Upgrade eligibility will be determined based on standard upgrade eligibility rules. Customers must be upgrade eligible to receive the qualified upgrade pricing. However, not all customers will be qualified upgrades. AT&T has not determined the price of the 3G device for non-qualified upgrades.

All customers will be required to sign a 2-year agreement. There will not be a “no commitment” price for the iPhone 3G.

Note: When the 3G device launches, all active postpaid customers in good standing with a 2G iPhone will be eligible to receive the qualified upgrade pricing for a 3G device regardless of service tenure. (Customers that would not otherwise be eligible due to tenure will be made eligible at launch).

Activation Process
The new 3G device will be activated in store in both AT&T and Apple stores. Customers must accept AT&T and Apple Ts & Cs, sign a 2-year agreement, and select the data plan for the iPhone 3G before leaving the store. The current iTunes activation process will no longer be required for iPhone 3Gs, however a short tether process to unbrick the 3G device will be performed in all AT&T stores (tether cords will be provided). Apple stores will also perform this tether process, however in the event that a customer’s device is not tethered in the Apple store, their device will be inoperable until they get home and tether through iTunes. Prepaid and Pick Your Plan will not be allowed on the 3G device.

The SSK has been modified to allow customers interested in the iPhone 3G to enter their information, select rate plans and data plans, and print a document that will allow COR reps to quickly access the customer’s information in OPUS and save time for data entry in the activation process.

Note: In the interim, 2G iPhones will continue to be activated via iTunes - BAU. This is also true for existing AT&T customers who receive a 2G device as a gift, hand-me-down, etc. and wish to activate the device. Existing AT&T customers who switch to the 2G iPhone must tether through the iTunes process to begin using the device.

Compensation
Because the 3G device will be activated in store, compensation for the 3G device will be BAU. COR reps will receive compensation for upgrades and new activations with a 2-year agreement.

Purchase Limit
The device purchase limit will remain three (3) per customer for iPhone 3G in AT&T stores.

Allocations
If allocations are required at launch, supply chain will allocate based on January-April sales rates applied on a store-by-store basis.

Direct Fulfillment
The DF tool will be available at launch in COR for iPhone 3Gs. Customers will be required to pay for the device when the order is placed and the phone will be shipped to the store in the customer’s name.

Existing Stock of 2G Devices
We will continue to sell 2G devices until stock is depleted.

Return Policy
2G Devices
Customers who recently purchased a 2G iPhone may want to return their device once they hear about the 3G model and price point, but the new device will not be available immediately. Since the announcement and launch will be about 30 days apart, we could lose some customers who are within their BRE period and want to return their device before their 14 days expires and wait for the new 3G device. We must acknowledge and address their desire to get the best device for them.

Here’s how AT&T will handle 2G iPhone returns:

If a customer purchased before 5/27, we will follow BAU processes – no device returns. However, all postpaid 2G iPhone customers in good standing are upgrade eligible, so these customers will qualify to upgrade to a 3G iPhone when it is available.
If a customer purchased on or after 5/27 (within the 14-day BRE period before the product announcement on 6/9), we will let them exchange their 2G iPhone for an iPhone 3G before August 1. This means that after we launch the 3G model they can return their 2G iPhone, pay the 10% restocking fee, and purchase a new iPhone 3G before August 1.
Note: This modified return policy applies only to customers who purchase from AT&T stores.

3G Devices
The return policy for 3G is changing from 14 days to 30 days for both Apple and AT&T stores.

To cancel service within the first 30 days, the customer must return their equipment to the place of purchase (no exceptions).
If the customer cancels service after 30 days, they will be charged the ETF. The customer is not required to return the device to cancel after 30 days.
Special Notes Regarding 2G Devices

After the iPhone 3G launches, activations of 2G iPhones for new AT&T customers can be performed in COR stores or in the existing iTunes tether process. COR reps will receive compensation for activations of new AT&T customers done in store.
2G upgrades will continue to be activated via the existing iTunes tether process.
Existing 2G data plans will remain available for 2G devices until further notice.
Note: 2G iPhones are out of stock in the DCs, and the Direct Fulfillment tool for 2G is turned off. 2G iPhones have been removed from the “myRewards” incentive catalog.

Merchandising/Marketing

Current 2G iPhones should remain on device fixtures in store. Do not remove 2G demo devices until further notice.
3G demos will be pulled from stock when they arrive following BAU process for display devices.
Video loop content will be pushed to stores when it is available.
New docks and retrofit kits will be provided for existing iPhone fixtures.
The following merchandising elements will be in stores for launch:

Rate brochure and display rate card
22 x 28 poster
Window banner
Duratrans - will be available for markets to order
Coming Soon: Posters and banners are TBD
Training

Device training, including features and functionality, will be available via My CSP by 6/13.
OPUS training will begin no later than 6/20 and will be delivered via the Learning Edge.
Launch preparedness training, including last minute details, will be conducted the week of launch (if needed) via RSM or Centra sessions.
Communications/My CSP
All iPhone-related communications, inclusive of training announcements, will be posted to My CSP. Login and access are via the “Everything iPhone 3G” ad space. Or search on either keyword “iZone” or keyword “iPhone 3G” to locate.

Launch Plans
Support logistics for launch day will mirror last year’s iPhone launch:

Letters will be sent to all landlords under VP/GM signature for advance notice of store hours, crowds expected, possible parking issues, etc.
Security will be provided for locations requesting armed police or unarmed, uniformed guards.
Manager checklists will be provided to support RSMs to set expectations and help them be prepared to complete all required actions.
Documents will be posted on iZone to let RSMs know when to expect delivery of launch support materials.
Job descriptions for key launch day functions will be provided for: Back Office Manager/Inventory Runner, Crowd Manager, Greeter, Product Demonstrator, and Security Support.

***Confidential AT&T Information. For Internal Distribution Only.***