Study: Consumers Aren't Willing to Pay $500 for iPhone

Consumers aren't willing to pay what Apple may ask for the iPhone but if the price drops they'll switch their mobile service to AT&T Inc. in order to get it, according to results of a survey released Thursday.

Online market research firm Compete surveyed 379 people in the U.S., most of whom had heard of the iPhone and have shopped for an iPod, to find out how interested they are in the device to produce the uncommissioned report. The iPhone is a combined music player and cell phone that Apple plans to start selling in the U.S. in June.

More Like $300

Among the 26 percent of respondents who said they're likely to buy an iPhone, only 1 percent said they'd pay $500 for it. When Apple introduced the iPhone in January, it said it would cost $500 on the low end.

Forty-two percent of those who said they're likely to buy the phone said they'd pay $200 to $299.

The iPhone will be available only to subscribers of Cingular Wireless, now part of AT&T. In a blow to the operator's competitors, 60 percent of those in the survey who said they were likely to buy the phone said they'd switch their mobile operator in order to get it.

The phone may start out around $500 because early adopters will pay that, said Neff. But pricing will likely drop by $100 to $200 to target the mass market, he said.

For comprehensive coverage of the Android ecosystem, visit Greenbot.com.

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