[Veltliner]

I'd like to have an iPhone, but I'm with Verizon.

I was with AT&T once, when it was called Cingular, and it was a truly singular experience

AT&T probably took part of the development cost (and risk) to get the unique network status.

But this has to end, once the first saturation of the market with iPhones has taken place, and in order to get more sales, the iPhone will have to be freely available for all networks. (After all, others already start imitating the iPhone, it won't be that unique for much longer).

I like the design and the fact, that you can store photographic work in its memory, and display it on its decent screen at any time.

So, who's having the deepest look into the crystal bal?

[justjesper]

Well Apple has seen that there is a problem. Finally they have noticed that they could had sold much more if they had not tied them self to ATT. But hey they could had sold a lot more if it was a better phone. There has been so many problems with it, and the updates a few and not important.

So is it good that they have a contract with ATT ? perhaps it better, for now, until they get it up to a standard, where we can actually call it a smart phone :-)

[analogika]

The second Apple's business model becomes the rule, rather than the exception.

Not a year earlier.

[ginoledesma]

Well, you could also argue that whatever cut Apple gets from AT&T per iPhone subscriber is lucrative enough to maintain the contract for 5 years. The iPhone device itself is just a one-time purchase, but over-and-above that they get money with each month the subscriber is with AT&T.

[giggs11]

You won't want to hold your breath for the iPhone to show up on Verizon. As you might be aware of, VZ is a carrier that uses a CDMA network, whereas the iPhone operates on GSM. The only other major GSM carrier in the US is T-Mobile.

Seeing as how even rumor sites haven't offered speculation on a CDMA version of the iPhone, it seems unlikely that Apple would make one anytime soon.

[mduell]

Imagine if you bought a computer and it not only would only work with AT&T DSL, but it required a 2 year contract for that DSL just to use even if you didn't want internet access. How the cell phone market (globally, not just in the US) got to this point is insane.

[ginoledesma]

I don't know how it is for the rest of the world outside the US, but this isn't much of an issue in Southeast Asia, at least. The cellphone companies definitely have a bigger influence over the customer base more so than the cellular service providers. It helps that most are GSM networks, though. Not to mention land coverage is smaller. :-)

[analogika]

Imagine if the computer you wanted to buy didn't exist because makers have been completely constrained to the conditions, features, and price ranges dictated by the DSL providers. How the cell phone market spent fifteen years in that hell is just insane.

Now, FINALLY, somebody has the guts to build a device that people WANT, regardless of what carriers dictate, and makes it SO DAMN DESIRABLE that carriers are even willing to build infrastructure *specifically* for that ONE phone - a complete, 180-degree turn on the market. So they bait with exclusive contracts to sweeten the deal.

For now.

[anthology123]

Verizon would be selling the iPhone if they didn't insist on re-designing the iPhone (they probably would want to have a telescoping antenna!)

[msuper69]

Originally Posted by anthology123 

Verizon would be selling the iPhone if they didn't insist on re-designing the iPhone (they probably would want to have a telescoping antenna!)

Don't forget the "SHORTCUT MENU" Title so we can find where the shortcuts are.

[Veltliner]

Originally Posted by giggs11 

You won't want to hold your breath for the iPhone to show up on Verizon. As you might be aware of, VZ is a carrier that uses a CDMA network, whereas the iPhone operates on GSM. The only other major GSM carrier in the US is T-Mobile.

Seeing as how even rumor sites haven't offered speculation on a CDMA version of the iPhone, it seems unlikely that Apple would make one anytime soon.

That's quite a decisive fact.

I just wonder what makes it so difficult to built a phone for more than one standard.

[f1000]

By sticking with just one carrier, Apple can also demonstrate how advantageous selling the iPhone can be to a carrier's bottomline. AT&T has definitely benefited from the iPhone, and other carriers are bound to give Jobs whatever terms he wants in order to be given an opportunity to sell the iPhone in the future...that is, if they're still around.

[Veltliner]

Originally Posted by f1000 

By sticking with just one carrier, Apple can also demonstrate how advantageous selling the iPhone can be to a carrier's bottomline. AT&T has definitely benefited from the iPhone, and other carriers are bound to give Jobs whatever terms he wants in order to be given an opportunity to sell the iPhone in the future...that is, if they're still around.

I wouldn't say a demonstration like this would be a good marketing coup.

After all, it's all about the revenues.

Why would you want to show someone how much money they can make with your product, and then not make it by restricting oneself to only one carrier.

I have the impression a CDMA iPhone could be developed, and, at a future time (not as far in the future as the Jedi knights) an iPhone will be available to all carriers.

Apple, after all, is in business for maximizing their sales, not giving AT&T a good time.

[Nodnarb]

Right, which is why people are saying this will happen in ~5+ years. Not any time soon.

[Simon]

Here's the deal.

In the "old days" the carriers had all the power. They owned the networks, decided which services to offer, and set the prices. The devices (even when they were technologically very advanced) had no value and were basically thrown after people who in turn paid for the subsidies with their overpriced voice phone plans (lots of useless minutes for cheap, not a lot of data, and no free choice of services).

Enter Apple. They want the device (and more importantly the services running off of it) to be important. They want to run Safari off of cell phones. They want people buying iTunes media on their phones. They want the service to be important rather than the network. The carriers are reduced to nothing more but 'dumb bandwidth' suppliers. They don't get paid for useless services but instead have to offer data flat rates so customers have the choice of what kind of services to use and when they use them. The device is sophisticated, slick, and it isn't cheap. Apple wants to earn money with it, but they know buyers won't pay >$500 when other devices are offered for free with plans. Subsidies? No. They know at the same time that customer appreciation for the iPhone would vanish should the devices be subsidized by the carriers.

So what do you have? On one hand there's this terrific device that people will want. On the other there's Apple that wants to charge roughly $700 a piece and at the same time tell the carriers what plans they have to offer with the device. To make matters even worse they dictate low-priced data flat rates.

What is the one and only way to get any sane carrier to close such a deal? Give them exclusivity. Tell them, "hey, everybody will want one so you'll keep all you old customers for longer and you'll get a lot of new customers from other carriers". No need to remind carriers that the market is saturated. They now damn well the only way to sell more plans is to grab customers from competitors. And there you go.

What we are seeing now with Apple and the one carrier per country lock-in is the only way everybody in this deal gets what they primarily want. Seeing it laid out this way, it becomes quite clear that Apple simply cannot give up exclusivity in this phase. And it certainly won't change within the next two or three years.

[Nodnarb]

Just for the record--- I switched from Verizon ONLY for the iPhone... got to keep my number too.

I also know 3 other people who switched just from verizon, one from T-Mobile, and then one who was already on AT&T but upgraded. And that is all from my narrow narrow window of iPhone owners.

I'd like to know some numbers on how many people actually left their carrier exclusively to get the iPhone. I bet it's large enough to have some kind of an impact on these other companies (namely, verizon, who turned down the iPhone in the first place...).

[butterfly0fdoom]

The statistics from after the iPhone launch indicated that AT&T got a large wave of new customes after the iPhone came out. Forgot the exact figures.

Once Verizon's transition to GSM is completed (when they implement 4G), then will Verizon have a chance at snagging iPhone exclusivity from AT&T. But given that Verizon is most likely unwilling to bend to Steve Job's will, the iPhone will probably stay on AT&T for longer than the 5 years required.

That said, with the release of the iPhone, we're seeing more powerful and capable devices than before. Whereas power phones and smart phones were just halo status rarities, this year's MWC's showings, as well as statistics and analyst predictions, indicate that the iPhone has indeed contributed to spurring a shift towards phones that do more than just make calls. With phones increasingly gaining a wide swath of capabilities, there's only so much that the carrier can provide on their end aside from bandwidth. Even Nokia and Sony Ericsson launched their own content services for their customers. So in this regard, Apple has indeed left and impact on the mobile phone industry, and the sooner the other carriers realize that their future role is merely to provide bandwidth, the better for the telecos.

[stevesnj]

Please for gods sake make this a sticky!!

[cnlevo]

Iono, but the phones can be unlocked SOOOO easy. I HAVE at&t and i unlocked mine so it wouldn't throw a two year on me.


But as far as it being for AT&T ONLY! i can't really complain from a personal (and selfish stand point) because I work for them, so everyone who rushed to the store to get one I made alot of money off of in commission.

[Veltliner]

Originally Posted by cnlevo 

Iono, but the phones can be unlocked SOOOO easy. I HAVE at&t and i unlocked mine so it wouldn't throw a two year on me.


But as far as it being for AT&T ONLY! i can't really complain from a personal (and selfish stand point) because I work for them, so everyone who rushed to the store to get one I made alot of money off of in commission.

Once Verizon goes GSM that would be an option.

What exactly do you do when you "unlock" an iPhone? Is there a password style gate keeper application that watches over AT&T exclusivity, or is it more complex, a system wide encryption?

[Veltliner]

Originally Posted by butterfly0fdoom 

The statistics from after the iPhone launch indicated that AT&T got a large wave of new customes after the iPhone came out. Forgot the exact figures.

Once Verizon's transition to GSM is completed (when they implement 4G), then will Verizon have a chance at snagging iPhone exclusivity from AT&T. But given that Verizon is most likely unwilling to bend to Steve Job's will, the iPhone will probably stay on AT&T for longer than the 5 years required.

That said, with the release of the iPhone, we're seeing more powerful and capable devices than before. Whereas power phones and smart phones were just halo status rarities, this year's MWC's showings, as well as statistics and analyst predictions, indicate that the iPhone has indeed contributed to spurring a shift towards phones that do more than just make calls. With phones increasingly gaining a wide swath of capabilities, there's only so much that the carrier can provide on their end aside from bandwidth. Even Nokia and Sony Ericsson launched their own content services for their customers. So in this regard, Apple has indeed left and impact on the mobile phone industry, and the sooner the other carriers realize that their future role is merely to provide bandwidth, the better for the telecos.

Do you have any info about when Verizon will arrive at using GSM?

[f1000]

Originally Posted by Veltliner 

I wouldn't say a demonstration like this would be a good marketing coup.

Apple's one-carrier approach wasn't a marketing effort aimed at consumers -- the Apple faithful were going to get their hands on an iPhone no matter what it did -- its one-carrier approach was aimed at impressing carriers, who undoubtedly had qualms about granting Apple privileges never before given to other cell phone manufacturers. Non-licensed carriers like Verizon became Apple's "controls" in this experiment. By initially pricing the iPhone at up to $599 a pop, Apple ensured that the main barrier to entry for the average consumer would be the price of the phone, not the switching of carriers.

AT&T has demonstrated that it's willing to give Apple unprecedented control in delivering an end-user experience and a cut of the revenues. Consumers have demonstrated a willingness to switch carriers to get an iPhone. Most importantly, AT&T has an exclusive (meaning legally-binding) agreement to carry the iPhone for five years. With all of these factors, Apple is very unlikely to sell the iPhone through other U.S. carriers during the next five years.

Why would you want to show someone how much money they can make with your product, and then not make it by restricting oneself to only one carrier.

Since the second coming of Jobs, Apple has long restricted the sales of its products through brick-and-mortar stores, and this retail strategy has worked brilliantly. Apple has no intention of selling the iPhone through carriers who will vandalize its product with corporate logos, or who will handicap its operation by restricting/not providing features, or who won't revenue-share.

I have the impression a CDMA iPhone could be developed, and, at a future time (not as far in the future as the Jedi knights) an iPhone will be available to all carriers.

Of course a CDMA iPhone can be developed, but as I already pointed out above what's in it for Apple?

Apple, after all, is in business for maximizing their sales, not giving AT&T a good time.

No, Apple is in the business of maximizing its revenues AND PROFITS. Turning the iPhone into a cheap, bastardized commodity along the lines of an LG-phone isn't in Apple's interest.

Bottomline, if you want an iPhone in the U.S. for the next five years, you have two choices: buy one through Apple/AT&T, or buy an iPhone, unlock it, and then operate it through one of the other GSM carriers.

[f1000]

Originally Posted by butterfly0fdoom 

Once Verizon's transition to GSM is completed (when they implement 4G), then will Verizon have a chance at snagging iPhone exclusivity from AT&T.

I seriously doubt that. Apple isn't going to be interested in fighting a legal battle with AT&T for a marginal increase in revenues, at least over a rather short-term deal. Besides, companies like T-Mobile are already GSM, but Apple hasn't signed any agreements with them.

I think you guys greatly underestimate Apple's desire for revenue-sharing and control of end-user experience. With the success of the AT&T iPhone rollout, Apple isn't desperate for carriers. It's been willing to turn down deals with GSM-carriers in other countries who refused to give Apple what it wants, even when Apple didn't yet have an exclusive carrier in those countries.

[Cold Warrior]

FWIW, by the time Verizon rolls out LTE (that's what 4G GSM is called) in its current coverage area, the 5-year ATT deal will be over. Five years is ages in the tech biz.

[SirCastor]

If you have a moment, I recommend The Untold Story from wired. I don't know how accurate it is, but it makes for a good read...

I see Apple getting out of their contract with AT&T as soon as is possible. They don't like carriers and they don't want them. I also don't really think that the iPhone is being sold as a subsidized device. I think we all assume that's happening because that's the way that the cell phone carriers have always done it. You buy a phone, you get the price knocked down with your agreement. Currently, software-wise that is the case. You can't use your phone until you agree to the contract blah blah blah... But I think when the AT&T deal is done, Apple will be selling iPhones unlocked for $400. The provider lockdown is a necessary evil for the moment.

I imagine what will/has happen(ed) is that Apple is changing the Cell phone industry. Phones will be made by the dictates of consumer demand rather than by the desires of the providers. By the time the providers realize what's happened, it'll be too late. Much like the music industry, the providers will try to fix it, but with disastrous results. The shift from subsidized-phones and multi-year contracts will happen as prices for quality phones go down and are purchased at Big box retailers like a computer or a TV is. You'll slip in your sim and be good to go.

BTW, as of right now, this is the case with my iPhone. I've got my SIM in there with a chip that fools the phone into thinking it's AT&T... the phone ought to be free and clear out of the box. Apple had to set the precedent into motion for this to happen, and by the time the bigwigs figure it out, it'll be too late.

[f1000]

Originally Posted by SirCastor 

I also don't really think that the iPhone is being sold as a subsidized device. I think we all assume that's happening because that's the way that the cell phone carriers have always done it.

I certainly didn't claim that the iPhone was a subsidized device. Apple is revenue-sharing, which is a different concept. With such a tony deal, why the heck would Apple ever want to sell the iPhone through service providers who would seek to lowball the iPhone to customers using a razor-and-blades business model? After companies like LG sell their crappy phones to service providers, it's the providers who give away those phones in order to gouge customers on service costs. Companies like LG don't make any more money on each unit post sale, and thus they have zero long-term incentive to offer software updates or feature upgrades on previously sold units.

Apple not only gets its pound of flesh on each sale of an iPhone, but it gets a cut of the revenues for god knows how many months from each of AT&T's iPhone subscribers. None of the other providers was willing to cut Apple such a deal, so I don't see how AT&T is taking advantage of Apple.

As long as people are willing to switch to AT&T to get an iPhone or one of its future iterations, I don't see a reason for Apple to ever unlock its iPhones. According to the Wired article, Apple makes roughly $10 per month on each of its AT&T iPhone customers. That's an extra $600 of PURE PROFIT per customer over five years. Apple would have to sell five iPhones per customer through non-revenue sharing providers to earn the same money. Moreover, selling the iPhone through multiple service providers will only turn the iPhone into a none-too-unique commodity, one poorly supported by any of the providers. Right now, AT&T treats the iPhone like prime sirloin, which helps to boost the iPhone's profit margin.

[butterfly0fdoom]

Originally Posted by SirCastor 

I see Apple getting out of their contract with AT&T as soon as is possible. They don't like carriers and they don't want them. I also don't really think that the iPhone is being sold as a subsidized device. I think we all assume that's happening because that's the way that the cell phone carriers have always done it. You buy a phone, you get the price knocked down with your agreement. Currently, software-wise that is the case. You can't use your phone until you agree to the contract blah blah blah... But I think when the AT&T deal is done, Apple will be selling iPhones unlocked for $400. The provider lockdown is a necessary evil for the moment.

I imagine what will/has happen(ed) is that Apple is changing the Cell phone industry. Phones will be made by the dictates of consumer demand rather than by the desires of the providers. By the time the providers realize what's happened, it'll be too late. Much like the music industry, the providers will try to fix it, but with disastrous results. The shift from subsidized-phones and multi-year contracts will happen as prices for quality phones go down and are purchased at Big box retailers like a computer or a TV is. You'll slip in your sim and be good to go.

Apple has dramatically changed the cellphone industry in the US and in Europe, but in some parts of Asia, the cellphone industry works differently; you buy the phone and then the service, you're not required to buy both from the telecom, and the phones are not built around carrier specifications. It's time that the western world's cellphone industry moved in that direction, and Apple is bringing us closer with the iPhone's setup. Your vision for the future is already the present reality in at least Taiwan and Hong Kong.

[Andy8]

Originally Posted by butterfly0fdoom 

Your vision for the future is already the present reality in at least Taiwan and Hong Kong.

Exactly.

Consider than almost a quarter of all iPhones end up unlocked, the majority being in Asia.

[ocbizlaw]

Originally Posted by butterfly0fdoom 

Apple has dramatically changed the cellphone industry in the US and in Europe, but in some parts of Asia, the cellphone industry works differently; you buy the phone and then the service, you're not required to buy both from the telecom, and the phones are not built around carrier specifications. It's time that the western world's cellphone industry moved in that direction, and Apple is bringing us closer with the iPhone's setup. Your vision for the future is already the present reality in at least Taiwan and Hong Kong.

I've got news for you. If you're willing to pay the actual cost of the phone you can buy it and take it to any compatible carrier. The U.S. model simply allows the carrier to subsidize the cost of the phone IF you are willing to agree to use it on that carrier but with the exception of the iPhone that IS the model. And there are two other things you are missing. First, unless Apple follows the same model that almost destroyed it in the PC world (the reason you are probably all posting from PC's running Microsoft Windows) the iPhone will not stay limited to exclusive carriers if the demand remains as high as it is because it will either be unlocked or, eventually, someone will copy it adequately. Second, the iPhone is not that great a phone. It's the brand (and certain features) that people are after. But I'm a business man. I'm after a phone that accomplishes certain tasks well. The iPhone does some well and some not so well. I don't care what logo is on the box. Other manufacturers phones come closer to mirroring the iPhone every day and with additional features that iPhone doesn't have. How about turn by audible turn by turn navigation, voice commands, etc. Besides, as a business man, with many wireless lines, I will not go to AT&T on my company's phones as long as I can buy unlimited minutes, text and web access for $99 a month on Sprint for the first line declining with each additional line when I have to pay $150 for identical service on AT&T just to get an iPhone. The sad thing is that AT&T monthly service remains so high because they have to pay Apple part of those fees. That means that all customers, including those not using iPhones, pay more per month to subsidize iPhone users. That is a model that won't work for long.

[Simon]

Originally Posted by ocbizlaw 

...(the reason you are probably all posting from PC's running Microsoft Windows)...

So you registered here to tell us that and didn't notice this is a Mac board? Smooth.

[turtle777]

Originally Posted by f1000 

No, Apple is in the business of maximizing its revenues AND PROFITS. Turning the iPhone into a cheap, bastardized commodity along the lines of an LG-phone isn't in Apple's interest.

From my financial background, I would have to say WRONG.

Apple is probably very much interested in PROFIT maximization only. Why ?
Because their top line (revenue) is already growing fast (computer sales), but their bottom line is under constant pressure.

A low revenue / high profit item helps in two ways:

a) maintain profit margins (KPI: Profit / Sales)
b) maintain EPS growth - important for stock valuation

-t

[turtle777]

Originally Posted by ocbizlaw 

I've got news for you. If you're willing to pay the actual cost of the phone you can buy it and take it to any compatible carrier. The U.S. model simply allows the carrier to subsidize the cost of the phone IF you are willing to agree to use it on that carrier but with the exception of the iPhone that IS the model. And there are two other things you are missing. First, unless Apple follows the same model that almost destroyed it in the PC world (the reason you are probably all posting from PC's running Microsoft Windows) the iPhone will not stay limited to exclusive carriers if the demand remains as high as it is because it will either be unlocked or, eventually, someone will copy it adequately. Second, the iPhone is not that great a phone. It's the brand (and certain features) that people are after. But I'm a business man. I'm after a phone that accomplishes certain tasks well. The iPhone does some well and some not so well. I don't care what logo is on the box. Other manufacturers phones come closer to mirroring the iPhone every day and with additional features that iPhone doesn't have. How about turn by audible turn by turn navigation, voice commands, etc. Besides, as a business man, with many wireless lines, I will not go to AT&T on my company's phones as long as I can buy unlimited minutes, text and web access for $99 a month on Sprint for the first line declining with each additional line when I have to pay $150 for identical service on AT&T just to get an iPhone. The sad thing is that AT&T monthly service remains so high because they have to pay Apple part of those fees. That means that all customers, including those not using iPhones, pay more per month to subsidize iPhone users. That is a model that won't work for long.

Boy, that's a load of bull, I don't even know where to start refuting it...

-t

[analogika]

I was thinking of replying, but then decided that since this entire thread is pre-iPhone 3G (FEBRUARY 2008), and thus about a completely different revenue model, his post was already completely off-base...so I didn't bother.

[jody475]

Hello, I would like to tell you the CORRECT answer to your question.... Unlike Most of these other replys, this is the true answer to your question so listen well!!!! AT&T Copyrighted the GUTS of the iPhone FOREVER, and the outer design for only 5 years, so on 5 years, apple will allowed to leagally offer the iPhone to other carriers! BUT they will have to redo the inside of the phone, so it may be thicker o thinner, have a different type of carrier, and many other differences that could be better or worse.. But either way the phone is going to look the same... And we all know that 5 years is a very long time, so until then, i recomend the HCT Touch, It is a very nice phone! And personally like it better than the iPhone! Its pretty much the exact same thing except the outter look.. (which i personally like better on the HCT Touch..) I HIGHLY recomend this phone, it is very nice!

Here Are a List Of carriers the HCT Touch is currently available with..
* Verizon Wireless (your carrier)
*Sprint/Nextell
*US Celluler
*Cellular South (which I highly Recomend if you live if you live in MS, AL, Or other southern states!!)
* Alltel Wireless, (it will be available soon!)
*and many other carriers

Here s a list of carriers that the HCT Touch Is NOT Availalble with

*AT&T (you can just get the iPhone....)
* T-Mobile (I recomend the sidekick, Its even cooler than the iPhone!)

Thank you!

[Mastrap]

^ Where to start?

[Simon]

Indeed. What a load of baloney! To think that somebody actually registered just to post something like that.

[ctt1wbw]

Originally Posted by Veltliner 

I'd like to have an iPhone, but I'm with Verizon.

I was with AT&T once, when it was called Cingular, and it was a truly singular experience

You too? Cingular was the WORST reception of ANY communications network that I have ever used, ever. And I've used lots and lots. Plus many other cellular networks. Cingular was the worst.

I, too, would dearly LOVE to have an iPhone, but I WILL NOT deal with ATT to get it. As soon as TMobile gets it, I'm all over it like white on rice, or flies on ****, whatever. Plus, why do other countries get multiple carriers of the iPhone, while the US only gets ONE?