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Big carriers lower prices on selected smartphones

In the last days of March, which coincided with the end of the first quarter, both Cingular Wireless and Verizon Wireless lowered prices on two key smartphones in their respective portfolios.
Is it “March Madness”-perhaps an attempt to juice subscriber numbers at the end of the first quarter?-or an effort to call attention to smartphones themselves, which promise higher ARPU from users? Perhaps a bit of competitive tit-for-tat? A combination of all three reasons? None of the above?
In Cingular’s case, between March 26 and April 2, it dropped the price of a Red Pearl by Research In Motion Ltd. to $150 (from $200) and reduced the price of Palm Inc.’s Treo 750 to $300 (from $400). Verizon offered two models of Palm’s Treo 700p for $250 (down from $300) and a RIM BlackBerry 7130e for $100 (down from $200).
Naturally, nothing is that simple: Cingular raised the price of its Nokia Corp. E62 smartphone to $70 (from $50). And Verizon raised its price on Motorola Inc.’s Q to $150 (from $80). Verizon recently conducted a promotional effort around the $80 Q, a promotion that appears to have ended.
Carriers don’t talk about their handset pricing strategy and analysts say a complex set of considerations-including the reasons proffered above-often makes certainty on this subject elusive.
Connect the dots at your own peril. (We certainly do.)


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