Apple not happy with Rogers over iPhone plan pricing?
We’ve heard through the grapevine that Apple isn’t pleased with Rogers right now, due to their insanely high iPhone data prices. This isn’t 100% confirmed at the moment, but here’s what is rumored to have happened:
- Rogers hired additional sales staff to handle the iPhone launch, all of whom have been fired effective immediately
- Apple has informed Rogers that they will be diverting a “large percentage” of their iPhone stock that was destined for Canadian shores, sending it instead to their European distributors. According to the rumor, this would leave Rogers with as few as 10-20 units per store for launch day.
The consumer backlash against Roger’s data rates was understandable, but we’re honestly a bit shocked to see Apple reacting in a similar fashion. Cupertino is doing one of two things here: they’re either attempting to strong-arm Rogers into lowering their data tariffs and making the iPhone more accessible to average consumers, or they really have simply given up and are abandoning the Canadian market in favor of a European market that seems a bit more eager to, uh, allow people to purchase an iPhone without mortgaging their Moose farm. Let’s hope, for the sake of our Canadian friends up North, that Apple is simply trying to affect some change, and that Rogers will be forced to comply by next Friday. Any more takers for the Rogers petition?
As much as I’d like to see Rogers punished for raping to canadian public for years, and being just to stupid to realize they could make more money, and build customer loyality by offering afforadable prices, I don’t buy it.
I don’t buy the “you’re screwed” text message from apple, or that RIM would chime in and have anyhting to say about it.
It seems like a little more manufactured demand. Tell people that there’s not going to be enough to go around and hope that brings them out in droves.
I hope this is true. It seems theres only 2 organizations that can stand up to Rogers raping its customers…Apple and the Canadian Gov, and it sure seems like the Gov does not give 2 shits about how Rogers is running things.
Good for Apple.
MRP, I appreciate your reservations. After all, any tech rumour should usually be taken with a grain of salt (especially Apple ones.) However, I can guarantee three things: 1) the texts from (admittedly low-level) employees at Apple and RIM were real and sent buddy-to-buddy, 2) the tidbit about the sudden staffing layoffs is definitely true and 3) I am definitely not a shill working to promote the iPhone or create any false sense of scarcity.
As I mentioned in the original article (see the BGR Read link above), there is nothing to say that this may not just be a manufacturing or shipping delay that has been blown out of proportion. I haven’t ruled out that possibility. Another point worth noting is that a lot could change before Friday and we may never know exactly what went on behind the scenes.
Nonetheless, it is fun to speculate, and hope for a better deal from Rogers…
Guys, face it no one is punishinmg any major corporation any more. They get way with it. Does anyone belive Rogers is going to change their Rates for the IPHONE this week?
I don’t.
Limiting supply will fuel demand, perceived scarcity will make people attempt to get it early. I suspect that this has more to do with apples strategy than any sort of dyspeptic response to Rogers pricing.
This looks as much as smart marketing as “punishing” Rogers. Why leave any inventory languishing with Rogers if you have markets that will sell out. Rumors are still rampant that the first run of handsets is only half what they expect to sell, and I can’t imagine that many Canadians willing to bend over for Rogers’ theft. And sorry, but theft is the right word for their pricing schedule.
Apple will not screw a partner and ruin a long-term relationship like that, nor will they shoot themselves in the foot at launch by delivering fewer units than can be sold. Apple has the right, however, to reallocate THEIR product to anyone they see fit.
The fact that Rogers has such high prices and so many people have showed discontent about those plans *might* mean that Apple sees more sales opportunites at launch in another market. Plus Steve and Ted are both a-types who probably hate each other, and so if Jobs were to pull a fast one on Ted to flex his ego, it wouldn’t suprise me.
The fact that some people who were slated to work at launch got fired is disconcerting though. However nothing suprises me with Rogers. Like any big telcom I’m sure they treat their employees like dirt.
Remember too that Rogers does not really own many retail operations directly – they actually have a dealer channel which operates franchises instead. Anytime you walk into a store with a “Rogers Wireless” sign, you are NOT in a Rogers-owned location. So this firing may be an isolated incident exclusive to a particular dealer. Who knows.
Let the floodgates open….
Smart move by Apple, Why send a few hundred thousand phones to canada if they’re not going to sell, iphone will be huge in Europe & in Asia cause #1 it’s going to be free in some countries & #2 they have the best plans, i doubt they will sell more than a few hundred units in canada. This will hurt Rogers a lot though cause the competition is getting the HTC Diamond & Samsung instinct, they’re not as Sweet as the iphone but is going to be offer with a super fast & cheap unlimited data plan, so Rogers is about to hit a brick wall cause they had there chance & they mess it up
Guaranteed we’ll see price drops on Rogers plans if Telus and Bell adopt unlimited data plans for the Diamond and Instinct (respectively).
Though I disagree with your assumption that only “a few hundred units” will get sold in Canada. I believe the industry prediction is closer to tens of thousands by the end of Q4. Time will tell I suppose.
Daniel,
I didn’t mean to accuse you of “making it all up” I just suspect that is the rogers manipulating the rumor mill for their own benefit.
Either way, I won’t be buying an Iphone the day it comes out. I want to see the blackberry bold first. Rumors (again) are that it won’t be too far behind.
Rogers is painting themselves in a corner here. We know that new telcos are comming to Canada next year to compete in the GSM space, we also know that the wounded telus is going to be upgrading to GSM (if they can put together enough cash) Bell, is going to be one of the most debit leveraged telcos in the world in Dec. They are far from being in good shape.
Rogers had an opportunity to give canadians a fair deal on one of the most hyped ( and therefore desired ) phones to have ever come along. This would have gone a long to ensuring customer loyalty when, next year, customers have more choices.
I guess they’re counting on people having short memories.
The other side is that Ted is getting old (72 now ?) when he leaves the company it will hire a board of directors to run it ( neather his son or daughter are suitable ) All it would take is some simple math to realize the Rogers is loosing money by not being reasonable.
So, the winds of change are stirring, the Canadian telco market will change in the upcomming year. I hope that the greed that Rogers has shown, and the stifling effect this has had on innovation in this country is not forgotten by canadians. Rogers needs to be punished by canadians, and our government needs to wake up an not allow one company to own a monoploy on a service. ( i.e. don’t let something like this happen again. Rogers should have never been allowed to buy FIDO)
That’s what someone at a Rogers Store told me… there were reducing the number of iPhones coming in… I’m glad Apple did that. Apple has always thought of their consumers.
Larrence – You make good points, but if Apple is so averse to screwing over long-term partners, why did they purposely engineer the iPhone to be jailbreakable to increase their unit sales, and to AT&T’s great displeasure? Or do you really believe the company that created one of the most secure operating systems in the world did their very best to protect the integrity of their ATT-lock?
You did hit the nail on the head about the firings. I’ve since updated my post with new info – apparently it was only certain dealer channels that hired iPhone staff and certain ones that fired them. Either way, it appears that Apple rescinded contributed funds, causing Rogers corp to do the same, causing rash decisions on the part of some dealer principals.
@MRP, No worries. I too look forward to the day when we can see a few more GSM players in the game. Maybe even a heavyweight like t-mo to bring the prices down a few notches.
Larren I meant, oops.
I wish they did the same thing to AT&T
Just wanted to let everyone know that the staff issue mentioned above was limited to only
specific Rogers Wireless Dealers, and then generally only in major cities across Canada. As
an employee of one of those dealerships, I am certainly upset about what has happened, and
apologize to any staff who have been let go.
As a dealer, we independantly hired these additional staff to help with the anticipated
increase in customer traffic on July 11th, and throughout the summer. This was done to help
increase our overall efficiency, and improve our customers overall in-store experience. We
were hoping to minimze wait times and help deal with customer questions and issues as
effectively as possible.
The decision to let these people go was certainly not arbitrary, and resulted from a last
minute decision by Apple which reduced the number of units being distributed to Canada. On
our part, it was a financial decision made due to the huge drop in revenue that we were
facing due to the change in allocated units. Like anyone else, we are in business to make
money, and our budgets are based on incoming revenue weighed against fixed costs like
staffing. Let be clear and say that these additional staff were not being subsidized by
either Rogers Corporate (RCI) or Apple. The decision and cost to hire them was entirely
ours. Without additional iPhones to sell, we are inevitably faced with significantly reduced
revenue potential, and as such were forced to make the decision.
Apple’s decision mentioned above, as many of you are already aware, was to divert a number
of iPhones to another carrier, as a result of an increase in demand from that market. This
was done in order to be fair and equitable to all the launch partners, and ensure that
customers all over the world get the same launch day experience and access to devices as
every other. This was certainly not done out of spite towards Rogers, nor was it an attempt
to penalize us for our plan pricing.
I will go out on a limb here and point out that while these plans may seem expensive, they
are in line not only with what other carriers are offering, but also very reasonable
compared to our other plans for Data devices. They provide consumers at every level the
features and data they need to get the most out of the iPhone.
Additionally, it is not really fair or accurate to compare cellular pricing in Canada with
that of other countries. Canada happens to be one of the lowest per capita users of
cellphones in the world, and combined with our large geographic area and the fact that we
strive to provide coast-to-coast network coverage to over 90% of the population, our average
revenue per user is actually very low when compared to similar networks in the US and
overseas. Add this to the fact that Rogers made the move to GSM at its own expense several
decades ago, and since then has been a world leader in rolling out the latest technologies ,
and you start to realize the cost of running such a network in Canada. What you may or may
not be aware of, is that it is due solely to the fact that Rogers has one of the fastest and
most advanced 3G networks in the world that Apple made the decision to offer the iPhone in
Canada. Without this network, we simply would not have the iPhone 3G in Canada, for obvious
reasons.
So be cautious when you compare our pricing to that of other countries, as it is not
generally fair or equitable to do so. I might add that if you looked at countries facing
similar issues as us in terms of cellular usage and geography, you will find similar
pricing. Take a lookat countries like Australia for realistic comparisons.
Thanks for reading! I hope this helps clarify some of the issues at hand. I look forward to
seeing you in store soon.
Cheers!
The only reason Apple is stepping in is because Rogers prices are turning customers away. And the less iPhones that sell, the less money Apple will make. Love Apple, but Don’t believe they’re stepping in because they “care”.
@jase Don’t even open that can of worms, US customers have nothing to complain about when it comes to data tariffs, I’d gibe my left nut to pay what you all pay for a BlackBerry Plan for example.
As for this rumor…I call shenanigans, their is no reason for Apple to pull them any of the stock and divert it elsewhere, Apple would have known what tariffs Rogers was planning on charging from the start anyways, so why put on a goodguy corporate face now.
RIM however has publicly scolded Canadian carriers in the past due to their high data tariffs, so until I see some official “scolding” from Apple, I’m taking this with a grain of salt.
According to CBC, a fedex plane just landed at Pearson International with iPhones on board. It was only a Boeing 737-800 coming from Los Angeles via Chicago. Very unlikely that Apple would get the entire space of that plane, which makes me think that there are probably only a couple thousand on board (for all of Ontario)
Wow, look at the corp. response from Rogers Dealer..typical Rogers trash talking!
@ ROGERS DEALER
Most of us DONT CARE about the price. Have you not been paying attention to our fight against Rogers? The price is fine.
WE WANT UNLIMITED DATA.
I AM A HEAVY USER AND WILL USW 2GB IN 5 DAYS.
Your data caps RUIN the experience of an iPhone.
Rogers Dealer,
Yes, lets look at Australia for a realistic comparison. Since only Optus has released pricing, lets use them.
In Australia, you can get a monthly plan with voice AND data AND visual voicemail for $19 a month, compared to a minimum $67 (plan + SAF) in Canada.
In Australia, you can get the phone pre-paid or on a 12 month contract. In Canada, 3 year contract required.
In Australia, you can get the phone unlocked through Rogers. In Canada, Rogers will lock you in for as long as possible.
Sense a pattern?
@rogers dealer
Save your sad sack story.
http://www.cbc.ca/money/story/2007/11/29/rich.html
“The prize for the biggest gain goes to Ted Rogers Jr., CEO of Rogers Communications (which, by the way, owns Canadian Business magazine). His wealth jumped 67 per cent in the last year — from $4.54 billion to $7.6 billion — thanks to the steady appreciation in the shares of the company he heads. That means his net worth increased by about $8.4 million a day, every day, for the last year.”
That’s obscene, there is no excuse for raping canadians like this. You’ll see that this can be done in a more profitable way by making it possible for the customers to buy ( i know shocking revelation)
I can’t WAIT to jump ship to Harmony or T-Mobile when they come to Canada.
@Rogers Dealer
“Canada happens to be one of the lowest per capita users of cellphones in the world”
And its only because Rogers and Rogers dealers think they are offering “GREAT VALUE” plans that penetration hasn’t been more significant.
Get your heads out of the clouds. Drive 2 minutes south and you can get unlimited data with unlimited voice. Rogers will only offer such a deal in our dreams.
And world leader in rolling out new technology? RIGHT. Australia’s Telstra’s Next G Network is 2x as fast as Rogers – soon to be 80mbps and reaching 99% of the population.
Apple should just pull the 3G Iphone out of the Canadian Market? really whats the point of it?
Just sell unlocked US iPhones for like $399 to us Canadians