AT&T has announced availability and pricing for the new Samsung Galaxy S4 smartphone. Customers will be able to preorder the Galaxy S4 starting on April 16th for $249.99 with a new two-year agreement. The carrier claims to be the first to offer the GS4 in the US, though Sprint, Verizon, T-Mobile, and other regional carriers have committed to carrying it.
That the Galaxy 4 costs customers $50 more than the iPhone 5 says far more about who is “winning” than any number of spec comparisons or sky-is-falling editorials. Samsung cannot get the same terms as Apple because end users in the U.S. do not switch carriers for Samsung’s sake. They do for Apple.
Analysts may spin this to a negative Apple story by suggesting that iPhone subsidies will soon rise as well, but that is the exact wrong conclusion. How Apple has co-opted the US mobile value chain and basically dictates terms to the carriers is absolutely fascinating; post on this soon.
The iPhone 5 starts at $199. Obviously, Apple needs to make a cheaper iPhone.
To be clear, the iPhone 5 is almost certainly more expensive that the S4. It just appears cheaper because Apple has a more advantageous negotiating position relative to Samsung with the U.S. carriers. In other parts of the world, like India for example, the value chain is completely different and cheaper Samsung models are kicking the iPhone’s ass.