AT&T promised me a free iPhone — or did it?

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Tomas Stockton is offered a “free” iPhone 5 from AT&T. So why isn’t he getting it?

Question: I recently spoke with an AT&T representative via chat about a billing issue with my U-verse Internet account. After resolving the issue, she offered me wireless service.

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At first I declined, stating that I was happy with my current carrier. But the representative persisted and offered me a family plan consisting of four lines of service and four “free” iPhone 4s’s for $179 per month with all taxes, surcharges and fees included.

Then I asked about the iPhone 5s and the representative stated that I could switch all of my iPhone 4s’s to the new iPhone 5s’s for free after 30 days. I was very skeptical and told her to contact me in 10 days. I printed our chat session as evidence.

A few days later, I called AT&T and spoke with a different representative and explained the offer. After I told her that I had it in writing, she agreed to honor it. She said that after 30 days, all I had to do is walk into an AT&T corporate store and pick up my free iPhone 5s’s.

A month later, I walked into the AT&T corporate store to pick up my free iPhone 5s’s and they had no idea who I was and could not find any notes on my account or any history of the offer.

I contacted AT&T, and a representative explained that the U-verse representative did not have the authorization to make that offer, and since it was not part of any current AT&T promotion, they would not be honoring it.

Please understand that I am happy with AT&T’s wireless service. I just want them to honor their offer of the free iPhone 5s’s. Can you help? — Tomas Stockton, Round Rock, TX

Answer: When someone offers you something for “free,” don’t walk away — run! Even if AT&T’s written offer had been legit — and I’m not saying it was — then the “free” part was a scam. No one is giving away “free” iPhones. At best, they are included in the price of your purchase.

To know just how brainwashed the buying public has become in regards to the word “free,” I point you to the hateful comment on this post about the true meaning of “free.”

You can’t make this stuff up. People believe in free, even when the facts say otherwise.

Only this time was different. At least, that’s what you thought. You were led to believe that you could walk into an AT&T store just 30 days after buying four iPhone 4s’s and trade them in for iPhone 5s’s at no additional charge. (That’s not a “free” phone, by the way; the price of your original iPhone 4s’s would have included an upgrade. If it were truly free, then AT&T would be handing out iPhones on the street corner. Last time I checked, it wasn’t.)

By the way, wireless companies are notorious abusers of the word “free.” Look at all these free phones from the AT&T site. Are they really “free”? No, they are not. You have to sign a contract and pay AT&T real money to get your hands on one.

You might have appealed your case to someone higher up at AT&T. I list their executives on my customer service wiki. But I’m not sure if it would have done you any good.

I went back and forth with AT&T on this issue several times. A representative reviewed your grievance and said you were right about the first iPhone 4s offer.

“The confusion comes when we get to the iPhone 5s issue,” he says. “We would not have offered anyone four of these devices for free. They were, still are, a leading product for us and that’s something we wouldn’t have done. We are just not sure how the customer might have gotten that impression.”

The chat transcript shows a representative saying you can upgrade your iPhone “and there is no fee.” But you interpreted that as AT&T saying the entire upgrade would cost nothing. AT&T sees it differently. It says that it was only agreeing to waive the upgrade fees, but not the cost of the phone.

You’re going to have to keep those iPhone 4s’s. Don’t worry, they’ll be eligible for an upgrade in two years.

Was AT&T's offer too confusing?

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53 thoughts on “AT&T promised me a free iPhone — or did it?

  1. so what att is claiming is he can buy 4 new iphone 5s and activate them on his account with no activation fee?

    that makes sense.

    the OP’s idea that he could get 4 free phones after only 1 month of service – does not make any sense. I think he only heard what he wanted to hear.

    like if someone went in to bridal store and they said “we can hem this 10,000 dress for free.”

    and the customer heard that as “I can have the dress for free?!” and expected the store to honor that

    1. The OP claims he has a chat session transcript supporting his version. Notwithstanding his chat session, I agree that his version of the deal sounds incredible.

      1. In Chris’ answer, he states that the guy misinterpreted the “and there is no fee” as “DUDE FREE iPHONE 5S!!!!”

      2. I’d be curious to see the chat long substantiating the grievance. Op might have grounds to cancel contract if what he states is true. Unfortunately, I think the OP might have been a bit optimistic here.

        1. I suspect that you might be right. My guess is that the OP didn’t know that there was an upgrade charge when a phone is subsidized. I didn’t know that either.

          1. Industry standard to require 2 year contract + handset fee. Older devices usually provided at no additional cost, but the newest phones come at a premium. Customer service is eager to lock you into a contract, so negotiate service credits.

            I’m on month to month these days. My phone is several years old, but I don’t like being locked into a contract. When service fails to perform, I have leverage to say if problems aren’t resolved, I’m walking. Results in credits =).

            @Christopher Elliot

            Any chance to give us the chat log?

          2. I haven’t had any issued with Verizon. If I had I might feel differently. The subsidy is about $400. The termination fee is about $400. I’ve been with Verizon for over 15 years. I figure I may as well take the $400 subsidy. I’m paying the same price for the monthly plan regardless. If I want to walk and have to pay back the $400 subsidy (or less pro rated) it seems to even out. At least for me, there is no downside.

          3. Sprint… enough said….Had them 15 years, too.

            I wish to hell I’d switched to Verizon when unlimited data existed… Sprint coverage is sparse, reliability is questionable, and data is oversaturated.
            Has been and remains a family plan…. so I guess the blame isn’t mine here.

          4. If you’re on a month-to-month and your contract is up, then you are overpaying by at least $25 for your plan. Either upgrade to a new phone (and then sell it) or switch to a cheaper plan.

  2. The cell phone industry needs some regulation. Offers need to be stated clearly, with all details in regular print using easy to understand words that are not open to interpretation . And the OP does need lessons in free—as Chris says there is no such thing as free. We all pay for it somehow. Based on the chat transcript that Chris sites, the OP heard what he wanted to hear. The rep said “no fee” and the OP heard free. No fee and free are not the same—even if using the cell carriers definition of free. The offer was a bit confusing, but one simple question–“What do you mean by no fee?” would have cleared that up promptly.

  3. Despite my disdain for complex cell phone offers, promotions, contracts, and T&Cs, the customer clearly dropped the ball here. If anyone missed it, read the third-to-last paragraph. The customer made a huge leap of logic by taking a phrase and putting his/her own interpretation on it.

  4. Really? He thought he could get “free” iPhone 5s because he was told there was “no fee” to upgrade them?

    Sounds like the OP needs to stick to “Assurance Wireless” and all of the other “free” phones and service offered and advertised on crappy daytime TV with the sketchy personal injury lawyers….

    1. Seems like this is where it would be important to see the customer’s question that led to the ‘no fee’ line. If the question was something like “Well the iPhone4 is nice, but I’d definitely switch to AT+T if you offered me the iPhone5 instead”, well that would completely change the context.

      1. I am sure Chris would have included that information if it had added more support for the OP’s claim of 4 free iPhone 5 handsets. It seems to me he included the relevant section of the chat session-the no fee statement from the AT&T rep.

        1. Well I see the beginning of the posting where it states that the customer was very skeptical, and seems like there would have been a follow on question or two. Certainly if I were very skeptical I would be reconfirming the free iPhone5 question.

          Of course it also sounds like this may have been clarified or not verbally with the 2nd rep, and that is where the real problem occurred.

          My guess is that:
          Rep #1 said, ‘no fee’ meaning you still pay full price for the iPhone5.

          Rep #2 said something like, “If Rep #1 promised you free iPhone5’s that is what you will get”, without actually looking at the original chat transcript, or doing any actual research themselves.

          In that case I would answer the poll yes, their offer is confusing because the customer made a good faith effort to try and get the offer clarified and that apparently didn’t work.

  5. Seems kind of hard to answer that poll question without seeing the transcript. “No fee to upgrade” is somewhat vague, but I’d want to see the customer question/response on either side of that statement

  6. Most cell phone plans require you to keep the original phone you receive when you sign up for at least a year before you can trade it in for a newer one or you pay what can sometimes be a huge amount for the new phone as well as an upgrade fee. What I don’t understand is why the OP just didn’t go with the 5s model to start with if that is what he wanted (unless this happened right when the 5s was being rolled out and AT&T didn’t have enough in stock or the 5s pans were much more expensive). But even 4 iPhone 4s units is still a great deal if it was $179 for all 4 as stated.

    Once again, someone only hears (or reads) what they want and not what was stated. While I agree that cell phone companies are scammy when it comes to pricing and one-sided contracts, I have to say that AT&T did nothing wrong here beyond the high pressure sales tactics used to get the OP to sign up.

    1. I’d love to see the conversation to see whether or not these monumental promises are factual. My guess, the OP read what he wanted to read and not what actually took place.

  7. I’m a little confused. People have been mentioning upgrade fees. Do some carriers charge a separate fee to upgrade your phone beyond the price of the new phone itself?

    1. Sprint charges an “activation” junk fee for new phones. I doubt it costs them $36 to put a phone on the system, especially when it is done by a customer through an automated system (you get charged the fee whether you use the automated system or have a rep do it in the store). And why is it only a new phone that gets hit with this junk fee when a used phone is added but doesn’t get hit with the charge?

      1. I’ve always wondered that myself, Maybe because they charge the same rate whether it’s anew subsidized phone, or a used phone, so they make more money when you activate a used phone? Just a guess.

        I have gotten AT&T to waive the fee every time I have upgraded. However when I upgraded in 2012, they pushed back a lot more, but eventually gave in and waived the fee stating they are noting it on my account, and will never waive it again.

      2. Well, it’s more of “buy a new phone fee” because if you source the phone yourself (i.e. a used phone from eBay), it’s generally free to activate.

    2. Yes, if you ‘upgrade’ your phone at Verizon you have to pay an upgrade fee. I use Verizon and my 2 year contract was long over and I needed a new phone. I wanted the HTC One and I paid for it outright, $500 (no fee, unlimited data, no contract). If I used the upgrade process the phone was $100, the fee was $30. I also lost my unlimited data and would have to pay an extra $20/month over the 24 month contract term to have a decent amount of data ($480). So over 2 years I’d have paid $610 for less data and being stuck in a contract.

      I did the math on their new “Edge” plan where you pay for the phone over time but can upgrade once you’ve mostly paid off the phone. The math there is better than the other contract, but still not as good as just paying for the phone outright.

      Disclaimer that all this math is useless if I don’t keep the phone for 2 years!

      1. Interesting. My experience was different. Of course, I don’t buy my phones from Verizon, I buy them from Costco. I’ve never paid an upgrade fee. I know because my bill never varies so I have the bank autosend the same amount every month. I also kept my unlimited data until the beginning of the year when I saved $75/month by switching. I don’t use much 4G data. I’m usually connected to a wi-fi either at home or work.

        Edited. I stand corrected. Verizon just introduced this fee in 2012. I checked the forum for the BS answer. The good news is that you can always negotiate. I purchased an iPad 2 from Verizon years ago. They only had 3G models which cost $100 more. I didn’t think I wanted a 3G equipped model. We worked out a deal where the store gave me a credit on my next bill for for about $125. I was happy.

        1. Yea, the negotiations are funny. I wanted the HTC One (okay, I wanted the nexus 5 but Verizon won’t carry it) and I don’t use much data either but I cannot pay more (or the same) for less service. So the guy was really pushy to get me in the contract (the two year or the Edge). Waiving all sorts of fees and discounts. Nothing was as cost effective as buying the phone outright and he seemed to know it. Even if it was exactly the same price I still lost the unlimited and was in a contract. You have to go in knowing what you want and how the math works otherwise you’ll pay way too much.

          1. Question. Are you using a prepaid plan? I generally get my phone subsidized because if I but it outright, I still pay the exact same monthly fee.

          2. It isn’t prepaid, I just didn’t take the subsidy so I don’t have the contract. The prepaid plans didn’t have any phones I’d like (only 3G which would be okay but the phones to choose from are pitiful). Unlimited data and text, and a 900 minute plan with a discount at work is about $105/month with all the fees and taxes.

          3. You never know when data comes in handy. Unlimited is going the way of the dinosaur as Carriers want to “Improve Customer Experience” by charging per GB. I.E. MORE MONEY MONEY MONEY – O YAH!

      2. If you want to avoid the Verizon upgrade fee, buy the phone yourself through a source like eBay or other non-authorized retailer. (As in, one that will simply let you pay your money and walk out the door with a phone without restrictions.) Then you go to the Verizon website and simply tell them you want an “ESN Change”; they’ll do this for free.

      3. @omgstfualready:disqus ,

        You’re grandfathered into the unlimited Verizon Data. So new handsets require paying full, unsubsidized, prices. If you sign a new contract, you lose the unlimited data and are locked into the restrictive plans.

        Carriers are flocking to charge for data. Ridiculous but a money making proposition.

        1. Oh, I know – I was grandfathered however any change I made to my existing plan – a new phone, reducing my minutes, anything and everything even if it had nothing to do with data still took away my unlimited data. That just grated on me so I did the research and buying the phone up front myself kept the unlimited data. I don’t use very much but it really was more about the point and over the 24 months I’d have been trapped under contract it still made the best financial sense.

          1. Agreed. Principle. If I were grandfathered, I’d pay full price over losing the benefit of unlimited data.

        2. Wow… This is weird… I’ve had a couple of phone changes with AT&T (I still have the unlimited data plan from them), and I get to keep the unlimited data… I find it strange that Verizon won’t allow any new contracts!

    3. In the US, fees are normally charged when upgrading a phone that is being subsidized by the carrier, aka on contact. Think of it as a loan fee. You are essentially borrowing money from the carrier to pay for a $600. Your loan payment is essentially built into the contract. It is not until recently where carriers like T-Mobile have started lower monthly bills in exchange for the customer purchasing the phone at full price with no contract.

    4. **Edited** As I’m late to this conversation and didn’t read through all of the comments first, I see that others have already mentioned what I wrote 🙂
      Verizon charges a $35 “upgrade fee” whenever you get a new phone. I’m not sure when they started this, but it was definitely in effect a few months ago. Last time I upgraded a few years ago, the fee was only for new customers, but recently, my daughter wanted the new iPhone 5. Since we’ve both had the unlimited data, and I knew it would end with the upgrade, I wanted to run the numbers to see what our new plan would look like. I went through the buying process on their website and saw the fee with no way to get rid of it. I was so mad that they are charging loyal customers for staying with them, I wrote an angry rant on their facebook page. They responded by telling me that it was due to the new technology, blah, blah, blah. I was even more offended that they thought I’d fall for that. Then they tried to tell me that all of the other carriers are charging the same fee and since Verizon was the best service, I should basically just pay the upgrade fee and be happy. I told them that Verizon should set a better example by showing their loyal customers that they appreciate them, but of course the people who run the Verizon FB page can’t change company policy and just kept repeating thta VZ is awesome. I’m still upset about it. It’s definitely a junk fee and there is no reason for it, just like a resort fee at a hotel.

  8. Has anyone noticed Chris removed all references to ‘free’ on his own site! How exciting! It used to say the newsletter was ‘free’ in a couple places to the right. I don’t see eye to eye on the ‘free’ stuff but I’m very pleased to see him walk his own talk! Good job!

    1. Yep, I noticed that. Since I use AdBlock and Ghostery, I know that I’m blocking 28 ads and 11 trackers on this site (allowing Disqus), so I know good and well that the website isn’t “free”. I chuckle everytime I get the popup asking me to “Wait!” and sign up for the free newsletter.

    2. I wish this whole “nothing is free” debate never started. I was out on New Years Eve and stopped at a convenience store for coffee. I went to pay and the clerk said coffee was free that night. I pointed out I was buying nothing else and asked if there was a catch. He said there wasn’t. I was skeptical. I left but later realized he could have taken down my plate number. I’m waiting for the authorities. I suspect I’ll now do time for stealing a large coffee.

      1. Free coffee is pretty common on New Year’s. And even if they tried to say you stole it, a check of the security video would show you talking to him and not be very supportive of their claim.

        1. McDonalds often gives out free coffee, no strings attached. There is an overall benefit to them as it gets people into the restaurant and often many are surprised that the coffee is better than they expected. But they are fine with people walking in, having a coffee and nothing else…when the promotion is on.

  9. It makes no sense to get four new phones and exchange them for four other new phones a couple of weeks later.
    Regardless of what was said, the application of a little common sense is required.

  10. It may be worth noting that at $179/month, the OP obligated himself to pay in excess of $4200 over the term of the contract. In light of that, his assumption may be more understandable. Sometimes we forget the substantial cost to which we obligate ourselves when we sign up for a cellphone.

    1. Op probably read too deeply into the “promise”. Agents are willing to offer service credits when trying to lock a 2 year agreement. I am suspect 4 new Iphone 5’s were promised.

      Wonder if Chris is willing to share the chat log?

  11. I guess NOTHING is ever free under Chris’s definition. For example, every day on my commute I see people handing out (purportedly) free snacks/drinks/etc. as an advertising strategy. But I had to walk over to them to get the item (a cost); my eyes see the advertising material when I take the product (a cost); if it’s a food item, I have to open the package to get at the item (a cost). So, yeah, if you look at it that way, nothing is ever free. Fair enough, I guess, but I don’t look at things that way.

    1. You are dealing with businesses. They have expenses. They are supposed to make a profit. Look at the overall cost and benefit of something, and you’ll be fine.

  12. ATT went so far over the top with marketing UVerse that I switched everything in our office over to ComCast. UVerse tele-marketers were so aggressive and horrible, calling the office 3 or 4 times a day, rattling on as fast as they could talk … disgusting behaviour for a previously-respected company.

  13. Most people understand that there is a portion of monthly fees during your 24 month contract that pays for your “subsidized” iPhone. Here is my question. If you keep your phone longer than 24 months (i.e. choose not to “upgrade” immediately), why don’t the carriers reduce your monthly charge at that point? I have never seen one do that, and I sometimes wait to upgrade, because I want to wait for a better or different phone release. It seems like the carriers are just ripping us off beyond 24 months,because they can.

    1. T-Mobile started separating the cost of the phone from the monthly plan once it’s paid off, by about $25. AT&T just announced a similar deal, but they’re only knocking $15 off once the 2-yr plan is finished.

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