Crybabies Emerge After Wal-Mart G1 Discount Announced - InformationWeek

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Commentary
10/30/2008
05:30 PM
Eric Ogren
Eric Ogren
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Crybabies Emerge After Wal-Mart G1 Discount Announced

Remember how ticked off people were when Apple dropped the price of the iPhone from $600 to $400 last year? People cried foul in droves. In light of Wal-Mart's announcement that it's going to sell the Android phone for $31 less than it costs at T-Mobile stores, people are complaining.

Remember how ticked off people were when Apple dropped the price of the iPhone from $600 to $400 last year? People cried foul in droves. In light of Wal-Mart's announcement that it's going to sell the Android phone for $31 less than it costs at T-Mobile stores, people are complaining.InformationWeek sister site ChannelWeb has posted an article titled "5 Reasons Against Wal-Mart Selling the T-Mobile G1." In it, the author posits reasons why the $31 price drop is bad.

The writer's biggest complaint is that the price of the phone has dropped by 17% a week after the device's release. He says, "Yes, it's wise to shop around before spending, but in the case of the T-Mobile G1, buyers who wanted the device right away didn't have an option. It was either pre-order it online or buy it at a T-Mobile store. Either way, the device was coming directly from T-Mobile and carried a price tag of $179.99. ... I don't think I'd mind so much if it was a few months later and Wal-Mart slashed the price, but a week is a really fast turnaround time. Why make such dramatic changes right out of the gate? From all that I've heard and read, the G1 has been selling well, so it wasn't really a move of desperation on T-Mobile's part."

I can understand his ire. I was one of the many irked iPhone customers who paid full price for the device when it was launched, only to see later adopters get the phone for $200 less. I wasn't the only one. Such a loud chorus was sung by upset iPhone owners that Apple eventually offered early adopters a $100 credit at Apple stores.

I don't know if it was T-Mobile's, HTC's, or Google's idea to sell the G1 at Wal-Mart stores, but all three companies have the right to distribute their products as they choose.

Wal-Mart has serious purchasing power and a highly developed supply chain. This is part of what allows it to offer lower prices than other retailers. Wal-Mart sells nearly everything for less than its competitors. That's the whole reason the chain has been successful. I don't think we should be surprised that it has the ability to offer the G1 for a price point lower than others.

I don't see T-Mobile placating early adopters of the G1 in the way that Apple did. And $31 isn't nearly as large or bothersome a sum as $200.

(BTW, the G1 was supposed to go on sale yesterday at Wal-Mart. Turns out shipping snafus have delayed the launch until Nov. 4.)

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