I never like to start off a Monday with this sort of tone, but when AT&T announced its first two 4G LTE handsets this morning at prices far below what Verizon has been sticking us with, it rubbed me the wrong way. There was a time when the argument that “LTE radios were expensive” was semi-acceptable, but no longer is that going to fly now that AT&T and their arguably far superior radios aren’t making their prices skyrocket (see what I did there).
The HTC Vivid and Galaxy SII Skyrocket are both top-of-the-line phones with their dual-core processors, big beautiful screens, and dual cameras, yet will be available at $199 and $249 respectively. You may remember that the Thunderbolt with its single-core processor and 2010 specs was delivered to us in March 2011 at $249 followed by the Samsung
Fascinate DROID Charge at $299. Think about that for a second?
If the price hike to well above $200 was because LTE radios were expensive, then why has AT&T managed to keep theirs down? And remember, AT&T is claiming that they waited to produce LTE phones until they could include radios with “circuit-switch fallback” technology that would allow batteries to last longer than the 4-6 hours that most of us experience on a daily basis. This tech is an all-in-one radio that works far more efficiently (according to AT&T – makes sense though) than Verizon’s dual 3G and 4G radio setup that requires each radio to be powered separately (hence the poor battery life). So not only is AT&T using better tech, but they are keeping prices down while still releasing top of the line smartphones.
“But they are only in 9 LTE markets! 15 by the end of the year!” Which I understand. Verizon had far more markets live when they released their first phone. Could it be that Big Red was trying to offset the cost of their rapid LTE rollout by raising prices of phones? Could very well be. I guess as a consumer, I feel a little robbed by that method, especially when it appears that AT&T will not be going that route. Then again, how long will take for another carrier to cover half of the country with these speeds?
What about the batch of phones we expect to see in the next month, though – the DROID RAZR, Galaxy Nexus and HTC Rezound? All have been pegged at the $299 price point. But remember, that all of these phones (at least to our knowledge), will still run first-gen 4G LTE radios, meaning battery life is still going to be an issue. So we get older and less efficient LTE tech than AT&T is using, yet have to pay higher prices because of a bigger network footprint? Man, that’s rough. I guess the trade-off here is that you actually get to use LTE with your $299 phone, while AT&T users could be waiting a couple of years to ever use theirs.
*Note - A lot of people pointing out (which I also did two paragraphs up) that this is likely all about actually having an LTE network in more than just a handful of markets. I totally get that argument. But at the same time, no one seemed to have that argument when Big Red initially launched with far less markets than they have today, but with 2-3 low-end devices at $200+ prices. We also weren’t sure what was fair pricing though. As some have suggested, maybe we helped decide that “fair” price by purchasing the Charge at $299. I think what will be the thing to watch here, is as AT&T rolls theirs out, if prices from either carrier are adjusted. Also, we know that AT&T’s 3G network is not of the highest quality, but we cannot say the same for their LTE network at this time.
The price we pay to be early adopters and have the best network, I guess. Any thoughts?