Sunday, March 20, 2011

Who Needs 3G for the iPad 2?

An article from wired.com takes a look at how consumers can save some serious cash by not buying 3G service for their iPad 2. It turns out consumers can just pay $20 a month and their iPhone can then be turned into a WiFi hotspot. If the consumers decide to pay for 3G service, it will cost them $130 and then a $15 monthly fee. It's very surprising to me that Apple would offer a service that could turn iPhones into a moving WiFi hotspot. It's a great idea, but Apple seems like they might be losing some serious money from this service. But this situation can be looked at from another perspective. People who thought that an iPad was useless without 3G, and didn't have the money to buy an iPad 2 with 3G capability, might decide to buy a cheaper iPad 2 without 3G capability. I also think Apple decided to offer this service since there are also several ways that consumers can turn their iPhone into a WiFi hot spot for free, by "jailbreaking" it. Apple probably just figures that if they don't offer the service, then consumers are just going to Jailbreak the phones, and their phones will be WiFi hotspots anyways. Also Apple might just be so successful that they don't really mind if people decide to not purchase the 3G service. Apple is probably making enough money off of the iPhone hotspot service. If I was going to purchase an iPad 2, I would seriously consider purchasing the one without the 3G service. I have my phone on me almost at all times, and it would be great if I could use it as a hotspot. Some people just feel more comfortable with the 3G service, and that is understandable. I think that the iPhone hotspot is a great service that a many consumers should consider when purchasing their iPad 2.

12 comments:

  1. I agree that the 3G service for the iPad 2 is a bit of a rip off. The idea of 3G access tricks consumers into thinking that it is worth the money when in reality, it's not. The low price of 20 dollars a month for the iPhone hotspot service is way more beneficial than paying 130 dollars up front for the iPad 2 3G service and then an additional 15 dollars a month. I would also rather have a fast WiFi connection through my phone instead of my iPad because like Curt said, I almost always have my phone on me. iPhones are smaller in size than iPads therefore they would probably be easier to travel with and take places. With that in mind, purchasing the overly expensive and overrated 3G service for the iPad 2 seems a bit ridiculous when you could have nearly the same thing but cheaper on your portable phone. I do not really understand why Apple would offer this alternative of a hotspot service for the iPhone if they are trying to sell 3G service for the new iPad. It gives the consumer many options, but at the same time it is making consumers not really want to spend the extra money on the 3G service when they know they can jailbreak it and get into the hotspot for free. Personally, I would rather buy the iPad 2 without 3G access and have my handy iPhone than spend so much more money to have the same capability I could have by spending less money.

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  2. I totally agree with Curt that most costumers are not buying the 3G coverage that comes with the i-Pad 2 because it is said to be a rip off. Many people found that it is just cheaper to use their own i-Phone as a “hotspot” network for their new i-Pad 2 to get free wifi connection. Whenever consumers purchase the new i-Pad 2 they found that it is way more economical to not buy the service charge for 3G coverage for a price of 130$ up front charge and then 15$ fee a month, but instead to just pay the 20$ a month on their i-phone to make it a wifi network. This action also makes more sense for most consumers because in today’s world people have their phone with them almost all the time. If I was the consumer in this scenario I would much rather just buy the i-pad 2 without 3G capabilities and just use the wifi portion of the product through my i-phone. This is the smarter decision because not only can you use the i-phone hotspot for the i-pad 2 but also for any device that can connect to wifi networks. In this scenario the consumer has the opportunity to be more economical to pay less money to get the same service rather than to pay more money for the same exact coverage.

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  3. If people can/are jail-breaking their phones do you really think Apple charging the hotspot fee will change this? Is jail-breaking illegal?

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  4. I think Apple is making a good decision by offering the wifi "hot-spot" because Apple is already a very successfull company and its future is looking good as well, by giving consumers the choice to choose a cheaper, more convenient option the company is boosting their comsumer satisfaction and loyalty. Which is overall the most important factor in business, without consumers to buy a product a company cannot make profit. Also now that the ipad will be more affordable, more people will buy it like Johne talked about.

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  5. Does Apple receive any money from the "hotspot" service or does AT&T/Verizon?
    Why would they offer the hotspot service if they do not make money from it?
    Does competition from Android have anything to do with the decision?
    Since Apple makes more money from a 3G iPad than a non 3G why would they even offer the non 3G?

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  6. I agree that purchasing the 3g service with the ipad 2 is unneccessary and a waiste of money. The fact that the price is higher than the iPhone "hotspot" connection that contains wifi makes people realize that the 3g service is a rip off. The hotspot connection with the iPhone is $20 a month and the 3g service with the ipad is $130 with an additional monthly payment of $15. Most people have their iPhones with them at all times so this enables them to have a wifi network connection with them. Looking at this, it shows that it is completely unneccessary to buy an expensive 3g connection when people could have wifi with them on their phones. Apple is making a successful choice by allowing people to have the hot spot connection. It is a more convenient and cheaper option for consumers to purchase, rather than a more expensive 3g connection. This is a positive addition to the Apple Company because it is making their consumers more satisfied. Purchasing the wifi hot spot connection is an option that makes the most sense to most people. I would prefer to not buy the 3g connection since it is less convenient. The hot spot connection is the better option since it can be used on a portable phone that people always have with them and it can also be used on the iPad and other portables. Consumers can purchase something cheaper that is the exact same thing as something expensive.
    -Bri Sharp

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  7. I think the way that apple is thinking is that if someone doesn't buy the Ipad 2 without the 3g but decides to use the Wi-Fi on their iPhone they will still be getting a profit from paying for the 3g on the iPhone. Apple is trying to keep the demand up for both the iPad and iPhone at this time because they haven't released a new iPhone in about a year. Apple's whole goal is probably to keep the idea of convenience that Apple is known for. With the case of jail breaking the iPhones, it seems as if Apple isn’t bothered by it so much due to the fact that they receive so much profit from people who actually rightfully pay for the 3g service. So bottom line, it is a good idea for Apple to offer the Wi-Fi hotspots to raise the sales of the IPhones for people who don’t have them but want the iPad increase the ease of using the internet.
    -Haley McCrary

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  8. I think Apple/AT&T/Verizon could possibly lose money on this because if people had an iPad but not an iPhone, so many people do they could probably just find someone's internet to mooch off of.

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  9. This comment has been removed by the author.

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  10. Smith, I don't think that Apple offering the WiFi hotspot will cause people to not jailbreak their phones. The thing is that not very many people know how to jailbreak the phones, and if someone decides to jailbreak their phones, then they can't go get their phone fixed if it breaks, and they can't update the phone. So the only people that would receive the full benefits from jailbreaking an iPhone are the people that can also fix it if something goes wrong with it, and can somehow find a way to update it. I don't think jailbreaking is illegal, but people can't update their phones if it's jailbroken.

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  11. Kern, I would think that Apple would have to receive some percentage of the money from the hotspots, since it's their product hat the WiFi is being offered on, but I'm not entirely sure about that. I also think that Apple makes plenty of money from the hotspot service. If someone has an iPad and they like the idea of the portable hotspot, then they might decide to go spend money on an iPhone wich is great for Apple.I also think the Android could have something to do with it. That is a great feature to one up the android with. They probably offer the non 3G since there are probably people who can only afford the non 3G, and selling a non 3G iPad is better than selling no iPad at all.

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  12. It seems to me that Apple would be losing money on the iPad 3G. Because people with iPhones can easily jailbreak their phones and create a free WiFi hotspot, spending an extra $130 along with a monthly fee of $15 for the 3G capable iPad seems completely pointless and is just a rip off. I think that if AT&T and Verizon lowered their prices for their 3G service, a lot more people would want to buy the iPad 3G. Even though it seems pointless to me, there are still people out there who are willing to pay the extra money for the convenience.

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