Why AT&T Wants To Keep the iPhone Away From Verizon 237
Hugh Pickens writes "Saul Hansell of the NY Times has an interesting post analyzing AT&T's earnings report and highlighting the enormous stakes involved in the renewal of its exclusive contract to distribute Apple's iPhone in the United States. Hansell does some rough calculations: 'If the average iPhone customer brings in $90 a month, or $1,080 a year in revenue, and the operating profit margin stays constant at 26 percent, that means an iPhone customer represents at least $561 in operating profit over a two-year contract,' says Hansell. 'Put another way, if the company gets 2.5 million new customers a year because of its iPhone exclusivity, the deal represents at least $700 million a year in operating profits — profits that it could lose if Verizon sold the iPhone, too.' With those sort of numbers, AT&T has every reason to make Apple an offer it can't refuse to keep its exclusive deal for another few years. Of course, the incentives for Verizon are presumably the mirror image, so expect Verizon to come to Cupertino, checkbook in hand, to see what sort of deal they can make. 'The benefit of somewhat more iPhone sales from wide distribution is likely to be swamped by a huge bid from AT&T to keep exclusivity, and an equally high bid from Verizon to win some (or maybe even all) of the business for itself.'"
Yeah God Forbid They Actually Have to COMPETE (Score:5, Funny)
Re:Yeah God Forbid They Actually Have to COMPETE (Score:3, Funny)
Re:Apple (Score:4, Funny)
I personally will not buy an iphone, until I can get service from Vanessa Blouin.
Re:Don't worry, AT&T (Score:3, Funny)
Apple is an unamerican, anticompetitive company .. (Score:3, Funny)
that has been manipulating the market and the public for years. Sadly, many consumers have bought into an elitist, exclusionary scheme to milk the world, all so a few people can live like kings.
Personally, I believe Apple never would have been successfully in a free and open market. We citizens tragically have let the greedy overrun the ethics and principles that America was built upon and should stand for. Sadly, we've become tools of the overly-affluent and power-mad.
Re:Don't worry, AT&T (Score:3, Funny)
Ring Ring (Score:4, Funny)
Switching from a GSM phone to a CDMA phone is simple, ... on the hardware side it's a matter of swapping out the modem.
Ring Ring!
It's for you!
It's analog radio engineers, everywhere, saying they want you to come over for a... a party. Yes, a party. To celebrate the ease of switching out radios.
I think I hear the FCC in the background gathering pitchforks too. Not quite sure what the intent is there.
Re:Apple (Score:3, Funny)
I personally realized that I am getting old when I had to JFGI Vanessa Blouin.
Yeah. Me too. Kinda glad I did though.
Oh yeah, well not only did I have JFGI Vanessa, I had to JFGI "JFGI". How do you think I feel now?
Better make sure your affairs are in order.