Scott Moritz of The Street is reporting that AT&T is considering dropping the entry level monthly data plan of the iPhone $10 to $59/month, back where it started two years ago. When the 3G iPhone was released last year with increasing load on the AT&T networks expected, data plans rose $10/month. The report cites Cote Collaborative analyst Michael Cote:
There is a "strong possibility" that AT&T will drop the entry-level price to $59 from $69, says Cote Collaborative analyst Michael Cote, an industry pricing strategist. The announcement, he said, will probably accompany the launch of the new iPhone on June 8, during Apple’s World Wide Developers Conference.
The price cut would underscore the pressure AT&T and Apple are under to boost iPhone sales.
AT&T needs a way to reach beyond its core iPhone customers to people who might find it too expensive. Meanwhile, Apple may be looking to push iPhone sales beyond AT&T and toward other players like Verizon...
The lower-entry $59 price would trim 14% off the existing cost of the service plan, reducing the cost of a two-year contract by $240. The current price of an iPhone including a two-year AT&T contract is a hefty $1,880.
"This price does not address the whole market," says Cote. And the price barrier has started to be a concern for Apple. For example, says Cote, "Wal-Mart iPhone sales haven’t met expectations."
The move would be welcomed by AT&T customers who are already expecting to pay another fee for tethering access on their unlimited data plans in upcoming 3.0 firmware. Moritz sites competition from other phones like Sprint’s Pre.
By now, everyone should know that Mr. Moritz is rarely, if ever, right on his Apple predictions and is widely accused of stock manipulation on The Street. He also is starting to look like Locke from Lost.