Apple offers 100 dollar refund to early iPhone buyers

Sep 6, 2007, 23:24 GMT

San Francisco - Apple chief executive Steve Jobs on Thursday apologized to early iPhone customers for cutting the price of the company's vaunted mobile communications device after they had made their purchases.

In an open-letter posted on the company's website, the iconic tech leader offered buyers who snapped up the phone before Wednesday's surprise 200 dollar price cut a 100 dollar credit towards other Apple products.

The move marked another unexpected development in the much hyped mobile phone that went on sale some 10 weeks ago. The announcement sent stocks of Apple plunging, as analysts interpreted the move as a signal that iPhone's sales had stalled. It also angered Apple's most loyal customers, the early adopters who lined up to buy the iPhone in the early weeks only to see the price drop by the equivalent of 20 dollars per week.

The iPhone cost 499 dollars for an 8 GB version when it went on sale at the end of June. The 4GB version cost 100 dollars less, but will now be phased out, Jobs said in announcing the price cut. Also in the announcement, Jobs launched the iPod Touch a music player that shares many of the iPhone's features but lacks its ability to make phone calls.

In his letter, Jobs said he had been inundated by hundreds of emails from customers 'who are upset about Apple dropping the price of iPhone by 200 dollars two months after it went on sale.'

Jobs justified the move saying it gave Apple a better chance to 'go for it' in the holiday season.

'It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone 'tent,'' he said. 'We strongly believe the 399-dollar price will help us do just that this holiday season.'

While noting that price cuts were a way of life in the technology world, 'we need to do a better job taking care of our early iPhone customers as we aggressively go after new ones with a lower price.'

'Our early customers trusted us, and we must live up to that trust with our actions in moments like these,' Jobs said. 'We apologize for disappointing some of you.'

The move was greeted by early iPhone users Thursday afternoon, many of whom were angry at Apple just a few hours earlier.

'I thought they had betrayed our loyalty but the rebate offer shows that Apple is a great technology company,' said Isabel Henderson, a graphics designer in San Francisco.