[macintologist]

I think this is a question that the media has never addressed. We all know that Cingular will benefit greatly from the deal, and we all know that Cingular is not subsidizing the price of the iPhone, so then how does Apple benefit from locking the iPhone into a 2 year Cingular contract? If Apple had simply released the iPhone unlocked so ANYONE could buy one and use it in whatever fashion that please them, wouldn't they get more sales?

Think of it this way: There is a certain number of people who WILL switch over to Cingular in order to buy the iPhone, and there is also a certain number of people who WOULD buy the iPhone except for the fact that it is locked down. Is Apple losing potential sales from this fact?

[Big Mac]

Apple said Cingular had to adapt its networks to the iPhone, which means Apple needed the carriers to play ball. If Apple were releasing a regular old phone, you'd have a point.

[macintologist]

But that's just for the one feature, visual voicemail. I bet Apple could let Cingular and T Mobile know ahead of time that it would be neat if they added these features to their network. Why do they have to sacrifice customer choice and additional sales for just one stupid feature that not everyone will use?

[Big Mac]

I'm not certain it's just visual voicemail that requires carrier support, but you're probably right in that regard. It may also be that Apple wanted to partner with a major carrier for a period of time to get demand up for the phone; then later on it could release an unlocked version. Many would rather go to a carrier to get a phone than to get the service and phone separately. Besides, prices have to come down anyway - the iPhone is on the expensive side with a contract. Partnering with AT&T reduces some of that shock, and AT&T probably insisted on the exclusive arrangement. It certainly wasn't Jobs insisting on it - he did a lot of arm bending to get favorable terms for Apple and bluntly likened the carriers to orifices through which hardware makers had to go to get to customers. If Apple could have marketed the iPhone without a carrier, there's no doubt in my mind it would have.

[msuper69]

Apple has always preferred making and controlling the whole widget to ensure an optimal user experience.

If the phone were to be unlocked, people using it on another network would be bitching about how things don't work right.

[chipchen]

Apple benefits by:

1. Very specific and limited marketing of the product (only sold at Cingular and Apple stores).

2. Restrictions on cost of phone (cannot be sold for less and subsidized)

3. Apple is rumored to be receiving a portion of monthly access costs

4. Success allows Apple to dictate further terms in renegotiation

5. Cingular markets the iPhone for Apple because they're the exclusive carrier (savings in ad dollars)

and more...

[GORDYmac]

I ageree with msuper69, going with one carrier is typical Apple. Unlike the Windows community--with multiple partners at multiple levels--Apple tends to develop unique relationships with a key partner (IBM & Akamai come to mind). I think that this agreement benefits both parties, but mostly Cingular, since they now have access to Apple's R&D. That can only help their poor reputation.

As far as Cingular's network is concerned, Visual VM is one of several enhancements I see down the road, thanks to Apple.

[yoyoman]

No verizon bummer. I won't switch just becuase its on cingular. No 3g is also a turn off.

[Northeastern292]

You all do have good points. The Cingular-exclusiveness may cause some low sales to start, but just like the iPod (when it went Windows compatible), but when other carriers do get to sell the iPhone, then sales may skyrocket.

Another thing that could help Apple is by making an smaller, less powerful iPhone (think original iPod mini, except the iPod mini was just as capable as the full size iPod).