Hey AT&T, Where’s That $600 No-Contract iPhone? (AAPL)


This past summer, AT&T promised an iPhone for prepaid customers — with no long-term contract — “in the future.” Because AT&T isn’t subsidizing the phone, it would cost $599 for an 8 GB model or $699 for a 16 GB unit.

So where are they? “We have not yet announced a non-contract offer,” an AT&T (T) rep tells us. Which doesn’t really mean anything. But we don’t expect to see them until next year.

Why not? Because forcing people to sign a two-year contract has worked pretty well so far: AT&T signed up 2.4 million iPhone 3G customers during Q3, each spending a minimum $70 per month for service. On average, iPhone subscribers spend 1.6 times more per month on service than a typical AT&T customer. That’s probably a lot more than a prepaid, no-contract Apple (AAPL) iPhone subscriber would pay per month.

Our thesis: Sometime next year, once Christmas sales are over, AT&T will open up non-contract iPhone sales for those desperate enough to wait.

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