September 6, 2007: Apple deals with its first iPhone PR crisis, as early adopters complain about the company dropping the price of its new smartphone by $200 just two months after introducing it.
In response, Apple CEO Steve Jobs offers affected customers a $100 credit, which can be used toward the purchase of any Apple store product.
“Our early customers trusted us, and we must live up to that trust with our actions in moments like these,” he writes in an open letter to iPhone customers published on the Apple website.
After controversial price cut, Apple gives $100 credit to iPhone early adopters
The price cut is one of two changes Apple made to the iPhone early on. In early September, it discontinued the low-end 4GB model (and you thought your 128GB iPhone was insufficient!), along with dropping the price of the 8GB model from $599 to $399.
The move was a response to early critics, like Microsoft’s Steve Ballmer, who laughed at Apple for releasing such an expensive product. (For more bad takes, read our roundup: ‘Apple should pull the plug’: 10 iPhone predictions from 2007.)
Nonetheless, Apple’s move upset many people who had rushed out to buy the iPhone — as the parody ad below demonstrates. According to a report in The New York Times on September 6, 2007, one customer responded to the price drop by announcing plans to manufacture T-shirts reading, “I was a $200 iPhone beta tester for Apple.”
Apple’s PR move wins the day
Not everyone was affected by the price drop. Those who bought an iPhone in the 14 days before the September price rethink were eligible for a $200 “price protection” rebate. However, people who had purchased the iPhone as soon as it became available did not qualify.
In the end, Apple’s $100 credit — something it was not legally mandated to deliver — did the trick and restored Apple’s great reputation for customer service.
Along with other controversies, like iJustine’s 300-page iPhone bill, the $100 credit for early adopters was a pioneering example of Apple dealing with the PR demands of its new smartphone business, years before Bendgate or Antennagate. Still, in this instance, Apple did right by its customers.
Were you an early iPhone adopter? Let us know when you first picked up an Apple smartphone in the comments below.
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
2 responses to “Today in Apple history: Steve Jobs hands out $100 to early iPhone customers”
they still missed out on another 100 bucks
I showed up the day after launch (i.e. I’m a fanboy, but I hate lines) and the store only had 4GB phones left in stock. I took that home, but when they announced the $100 credit, I went back and exchanged it for an 8GB model.