MONTREAL - Apple's iPhone may have a poisonous bite for Canadian consumers who want the much-desired touchscreen phone when it finally goes on sale later this month.
Analysts said Wednesday that consumers will have to pay the voice and data rates set by Rogers Communications Inc. (TSX:RCI.B) if they want the high-end device unless early sales are slow.
Rogers is the only Canadian carrier that has a network capable of running the iPhone, which goes on sale on July 11.
"Right now Rogers thinks that the iPhone is such a compelling device that people will essentially pay anything to get one," said PC Magazine's Sascha Segan.
"They they'll sign away their lives for three years, they'll pay higher data rates than are charged on other devices because the iPhone is so incredibly sexy and so incredibly desired."
The iPhone allows users to play music, watch movies, surf the Internet and manage personal information such as e-mails. Rogers has listed plans starting at $60 to $115 a month, requiring a three-year contract.
On Wednesday, Rogers said the rates it announced last week for the iPhone won't change, but repeated there were other price plans available.
Thousands of unhappy Canadians have responded to Rogers' rate plans in an online petition on the website RuinediPhone.com. More than 26,000 people had signed the petition as of Wednesday.
However Segan companies don't respond to petitions.
"If Canadians don't pick up iPhones and instead all go for the BlackBerry Bold, and it's coming out before the end of the summer, or they all go over to Telus and pick up Samsung's Instinct, then you bet Rogers will rethink their plan prices and terms," he said.
"But it's only going to change if Canadians vote with their wallets."
Rogers' spokeswoman Liz Hamilton said consumers can decide what's best for them.
Hamilton said consumers can pay $30 a month for a lower-use data plan to $100 for six gigabytes, which she noted is for heavy use such things as streaming video.
"They don't have to take the value packs. They don't have to take the plans. They can use our existing smartphone and data plans if they want to," she said.
The iPhone has already been on sale in the United States for year exclusively though AT&T. The lowest monthly rate for the iPhone in the United States will be about US$70 a month, including $30 a month for unlimited 3G data.
In 1995, Rogers bowed to complaints from cable TV customers and revised the way it planned to charge for seven new specialty channels.
Customers were furious about the so-called negative-option billing -- unless customers told Rogers they didn't want the channels, they would have been automatically be billed for them.
An new model, eight-gigabyte iPhone will cost $199, $200 lower than the previous model. A 16-gigabyte version will sell for $299.
Both AT&T and Rogers are subsidizing some of the costs of the phone and are trying to recoup costs through the rates it charges consumers.
Research Capital Corp. analyst Nick Agostino said it's a "take it or leave it" deal from Rogers, but added Rogers may be willing to lower prices if early sales are below par.
"If it looks like looks like things are sluggish and people are resistant to pricing then, certainly, I think they could certainly step in and lower pricing," Agostino said
Telecom analyst Roberta Fox said most Canadian businesses and consumers want to have unlimited or flat-rate defined plans.
They're "very uncomfortable" with having plans based on their use for data because they don't know what their bills will consistently be, said Fox of the Fox Group Inc. in Mount Albert, Ont.
Fox said Rogers is unlikely to change its prices, but may do "some creative bundles" involving perhaps the Internet and the iPhone.
"So if you want to get the best plans, whether you're a consumer or a business customer you have to do your homework," she said.
"Telecom contracts have never had clear language."
