The iPhone Canada launch and the Rogers backlash

I just came back to Toronto from Calgary and can confirm that iPhone frenzy is in full force there. It was the lead story in the evening news even though Calgary’s annual "Stampede" festival was in full swing. (If you’ve ever been to Stampede, you know how worked up Calgarians get about it.) 

The print, radio and tv coverage all seemed to follow the same template: A) People are waiting in long lines to get one and B) There’s anger at Rogers (the exclusive provider in Canada) for their pricing plan. This article at the Globe and Mail has a good explanation and a chart that shows the impact of the data pricing.

Lots has been written about the pricing fiasco and the eventual capitulation by Rogers to the consumer pressure. But I haven’t seen anyone point out the parallels with what Apple itself did when launching the iPhone.

If you recall, Apple’s initial price for the iPhone was quite high ($600) but was still purchased by the "must have it any cost" people. That was followed by rapid price drop (to $400) a few months later. Apple took some bad publicity for a few news cycles (Apple drops iPhone price by a third, early buyers not amused) but in the end, iPhone is still a coveted (even worshipped) device, and they made money off that early crowd. (Call it the "fanatic bonus".)

Rogers tried the same gambit and fell on their face. They had to back down on the pricing before the launch so they took the PR hit but didn’t get the pay-off. And worse, the sub-headline in every news story — and now in the consumer mind — is that "Buying an iPhone will lead to a large monthly bill".  Instead of a bonus, Rogers got a fanatic backlash including some protest sites like this one with 60,000 members.

More from Mark Evans (Is the iPhone a PR Fiasco for Rogers?), Jon Arnold (Rogers Backlash on iPhone Pricing) and ITBusiness (Canadians welcome iPhone, pan pricing plans).