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Why AT&T Wants To Keep the iPhone Away From Verizon

Soulskill posted more than 4 years ago | from the all-about-the-benjamins dept.

Cellphones 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.'"

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Apple (3, Informative)

ucblockhead (63650) | more than 4 years ago | (#27713571)

What this means is that after the bidding war that will ensue when Apple's contract with AT&T runs out, Apple will end up getting the bulk of the profits.

Re:Apple (1, Insightful)

penginkun (585807) | more than 4 years ago | (#27713679)

Well...yes. Who else? They made the device, they should be able to profit from it.

Verizon is in Apple's Best Interest! (Re: Apple) (4, Interesting)

StCredZero (169093) | more than 4 years ago | (#27714417)

A Verizon iPhone would be in the best interest of Apple, even if they had to give up some profits. Why?

1) AT&T's network Sucks. I have heard many complaints that the iPhone is wonderful -- at everything but being a plain cellphone.

2) AT&T's customer service sucks. DNA from a big telco. Monopoly mindset. Nuff said!

3) Mindshare is king. If there were a Verizon iPhone, there would be more Apple iPhone mindshare. I hated to leave Verizon's better network and service for AT&T's suckyness, but I did it anyways. Lower that barrier, and many more people like me would have an iPhone. In the long run mindshare = more profits!

Re:Verizon is in Apple's Best Interest! (Re: Apple (2, Insightful)

dreamt (14798) | more than 4 years ago | (#27714689)

I don't know. I just switched from Verizon to an iPhone and everyone I talk to tells me that my iPhone sounds clearer. And my house is in a Verizon dead-zone (I live about 10 miles outside of Boston -- there should be no dead zones that close to such a large technology based city).

Still have not dealt with customer service, but its not like Verizon's service was particularly great. And it was also from a big telco.

Re:Verizon is in Apple's Best Interest! (Re: Apple (3, Informative)

jae471 (1102461) | more than 4 years ago | (#27714763)

2) AT&T's customer service sucks. DNA from a big telco. Monopoly mindset. Nuff said!

Because Verizon (nee Bell Atlantic) is so much less of a big telco then the current AT&T (nee Southwest Bell)? Both are spinoffs of Ma Bell who gobbled up as many of their smaller siblings as the could.

That said, competition is a Good Thing.

Re:Verizon is in Apple's Best Interest! (Re: Apple (5, Insightful)

GizmoToy (450886) | more than 4 years ago | (#27715065)

A Verizon iPhone would be in the best interest of Apple, even if they had to give up some profits. Why?

1) AT&T's network Sucks. I have heard many complaints that the iPhone is wonderful -- at everything but being a plain cellphone.

2) AT&T's customer service sucks. DNA from a big telco. Monopoly mindset. Nuff said!

3) Mindshare is king. If there were a Verizon iPhone, there would be more Apple iPhone mindshare. I hated to leave Verizon's better network and service for AT&T's suckyness, but I did it anyways. Lower that barrier, and many more people like me would have an iPhone. In the long run mindshare = more profits!

Experiences with cell phone companies are so varied, it's impossible to draw any conclusions approaching 1) or 2)... if anything, all you can come up with is "All cell phone companies suck."

For every "AT&T's network sucks" you'll have a "Verizon's network sucks", and the same for customer service.

As an example, my wife and I both defected from Verizon. I've been with AT&T for 6-7 years, and her since the iPhone 3G launched. She left Verizon because of several experiences with rude customer service, and spotty coverage.

Re:Apple (0, Insightful)

Anonymous Coward | more than 4 years ago | (#27713955)

I personally will not buy an iphone, until I can get service from a company other that AT&T.

Re:Apple (3, Funny)

PopeRatzo (965947) | more than 4 years ago | (#27714389)

I personally will not buy an iphone, until I can get service from Vanessa Blouin.

Re:Apple (3, Interesting)

timeOday (582209) | more than 4 years ago | (#27714373)

Another effect is that Apple's competitors in the smartphone market will throw more money at dethroning them (either by improving their products or dumping money into advertising). But of course, success always breeds competition (well, at least ideally). In the end this should benefit us all by resulting in better smartphone services without 100% profit margins, but perhaps not since the psychology of fads is that only 1 thing can be "it."

Yeah God Forbid They Actually Have to COMPETE (4, Funny)

Greyfox (87712) | more than 4 years ago | (#27713583)

They might actually have to deliver that iPhone you see in the commercials. I'd love to trade with THAT iPhone but if they used mine in the commercials the commercial would have to end before it brought Slashdot up on the edge network...

Re:Yeah God Forbid They Actually Have to COMPETE (3, Funny)

Dragon of the Pants (913545) | more than 4 years ago | (#27713883)

Last year called, they want their criticism back. Ever hear of 3G?

Re:Yeah God Forbid They Actually Have to COMPETE (4, Insightful)

cpt_drewbie (1479889) | more than 4 years ago | (#27713973)

Ever used AT&T's 3G network on an iPhone? Most of the time you probably would assume it's running over EDGE.

Re:Yeah God Forbid They Actually Have to COMPETE (3, Informative)

maharb (1534501) | more than 4 years ago | (#27714063)

That is not the experience I have seen. In fact lots of people I know refuse to go through the hassle of switching over to wifi when available because they are perfectly happy with the 3G speeds. Maybe certain areas are different but I have never experienced what you are describing.

Re:Yeah God Forbid They Actually Have to COMPETE (4, Informative)

peragrin (659227) | more than 4 years ago | (#27714081)

last year called they want their criticism back.

when i first got the 3G network performance was bad. Over the last six month AT&T has brought it almost to the point where the iphone processor is the limiting factor. With rendering times almost equal between 3G and wi-fi.

What really gets me though is verizon can never have the iphone. Ever. It would have to be made exclusively for verizon customers. As Verizon uses phone technology that is incompatible with the majority of the world. GSM may not be the best solution, however it does have the largest user base. When will people understand this?

Re:Yeah God Forbid They Actually Have to COMPETE (4, Informative)

Otterley (29945) | more than 4 years ago | (#27714185)

The article claims that both AT&T and Verizon will be moving to LTE in the future. If this ever comes to pass, and Apple releases an LTE-compatible iPhone, the technology roadblock should vanish.

Re:Yeah God Forbid They Actually Have to COMPETE (2, Informative)

schnell (163007) | more than 4 years ago | (#27714635)

If this ever comes to pass, and Apple releases an LTE-compatible iPhone, the technology roadblock should vanish.

Not necessarily. Cellular carriers don't flip a switch and make their network technologies change - it happens market by market, tower by tower. Until Verizon upgrades 100% of their nationwide network to LTE - which even optimistically takes several years and costs tens of billions of dollars - then large parts of their network will continue to be CDMA, which is incompatible with the GSM-based iPhone. So even if Verizon could get access to a future LTE-based iPhone, it wouldn't work on large parts of their network for quite some time.

Re:Yeah God Forbid They Actually Have to COMPETE (1)

rakslice (90330) | more than 4 years ago | (#27715249)

Tens of billions? That's like $100k/tower. The equipment is expensive, but is it _that_ expensive?

Re:Yeah God Forbid They Actually Have to COMPETE (1)

da_matta (854422) | more than 4 years ago | (#27715279)

LTE alone is nothing. The point of LTE is that it provides next gen data bearer with voice & sms handover to (GSM) 2G/3G. You will never see the same coverage for LTE, and there's no point in providing it if you can't steer voice to 3G/2G. They could do that for CDMA also, but likely not as soon an easily.

Re:Yeah God Forbid They Actually Have to COMPETE (0)

RoFLKOPTr (1294290) | more than 4 years ago | (#27714219)

What really gets me though is verizon can never have the iphone. Ever. It would have to be made exclusively for verizon customers.

Why? Because Apple doesn't have the money to develop two separate phone models with different technologies, or, better yet, put both technologies in the same phone and basically enable everyone to have service in just about every square mile of land in every developed country? Yeah, right. The fact of the matter is is that Verizon is proven to have a moderately faster broadband network, and a definitely more stable network in general. Having the iPhone on Verizon might make me want to buy one.

Re:Yeah God Forbid They Actually Have to COMPETE (1)

PopeRatzo (965947) | more than 4 years ago | (#27714479)

Apple doesn't have the money to develop two separate phone models with different technologies

You're kidding, right? Didn't Apple just report an 18% profit growth last quarter? Do you have any idea how much cash on hand Apple has as a corporation?

Those cash reserves are a big part of why Apple stock has held so strong these past years. In 2001 I was at a dinner with the CFO of Apple, and I was at the same table as him. He started talking about their cash position and the size of that position floored me. I immediately bought stock, made some dough and dumped it in 2007. So, regardless of how much I dislike the fact that OSX is proprietary to Apple-branded hardware, I will always love Apple. They paid for my kid's first two years of university and will probably cover her grad school too.

They've got the money to develop an iPhone that will run on Verizon's network, have no fear.

Re:Yeah God Forbid They Actually Have to COMPETE (1)

RoFLKOPTr (1294290) | more than 4 years ago | (#27714545)

If you would read my entire, although admittedly long-winded, post, you will notice that I say "Because Apple doesn't have the money to develop two separate phone models with different technologies blah blah blah? Yeah, right."

Re:Yeah God Forbid They Actually Have to COMPETE (1)

Thansal (999464) | more than 4 years ago | (#27714619)

You're kidding, right? Didn't Apple just report an 18% profit growth last quarter? Do you have any idea how much cash on hand Apple has as a corporation?

umm, yes, yes he was.

Selective quoting + inability to detect sarcasm == win?

Because Apple doesn't have the money to develop two separate phone models with different technologies, or, better yet, put both technologies in the same phone and basically enable everyone to have service in just about every square mile of land in every developed country? Yeah, right.

there yah go :)

Oh, and my 2 cents?

I dislike both Verizon and AT&T, and the iPhone (well, specifically the price point for the data plans, which really boils down to the providers again) even more. Of course AT&T wants to keep the iPhone as an exclusive, it is a giant friken cash cow.

4G GSM (1, Informative)

Anonymous Coward | more than 4 years ago | (#27714319)

What really gets me though is verizon can never have the iphone. Ever. It would have to be made exclusively for verizon customers. As Verizon uses phone technology that is incompatible with the majority of the world. GSM may not be the best solution, however it does have the largest user base. When will people understand this?

Verizon has already announced that they will use GSM's 4G technology (LTE) for their network.

http://consumerist.com/consumer/unlocked/verizon-to-go-gsm-328914.php
http://arstechnica.com/old/content/2008/12/verizon-says-early-lte-deployment-in-2009.ars

Re:Yeah God Forbid They Actually Have to COMPETE (1)

maxume (22995) | more than 4 years ago | (#27714497)

I imagine Apple would be able to make a few million sales to Verizon customers, so they could probably do the radio for ~$10 a phone (I can see where it could cost more than $10 million, but it seems likely that it wouldn't).

So Apple might think they are better off spending their dollars elsewhere, but I can't see developing a Verizon only phone as that big of an impediment. As another reply noted, the networks are all converging on one standard, so the issue is going to (slowly) go away.

Re:Yeah God Forbid They Actually Have to COMPETE (1)

billybob_jcv (967047) | more than 4 years ago | (#27714509)

Yeah - it's not like you can buy any other phones that are available on both Verizon and AT&T - It must be completely impossible... /sarcasm

Re:Yeah God Forbid They Actually Have to COMPETE (1)

markdowling (448297) | more than 4 years ago | (#27714599)

Doesn't seem to worry RIM - they make scads of CDMA devices. President Obama's 8830 is a CDMA device (with a secondary SIM card), after all.

Re:Yeah God Forbid They Actually Have to COMPETE (2, Interesting)

rxan (1424721) | more than 4 years ago | (#27714717)

What really gets me though is verizon can never have the iphone. Ever. It would have to be made exclusively for verizon customers. As Verizon uses phone technology that is incompatible with the majority of the world.

I would say that Apple, not Verizon, is the major reason that Verizon still won't get the iPhone for awhile.

Apple has a history of only wanting to support one option for its customers, for unknown reasons. Most likely because they can reduce testing and development strain while still having a high quality product. I think Apple would only want to make one version of the iPhone because it's just easier.

Not to say that Apple couldn't do it. They just won't. Just like we've seen them leave out simple features that customers want (cut & paste), just because it's easier for them. RIM has made differently networked BlackBerry models for carriers many times before, mostly with flawless results. So it is perfectly possible.

Re:Yeah God Forbid They Actually Have to COMPETE (1)

JazzLad (935151) | more than 4 years ago | (#27714813)

Only partially correct, VZW is CDMA, as is Sprint PCS, Cricket & (IIRC) MetroPCS. True, CDMA is primarily a US technology, Japan uses it & I'm too lazy to look , but there are other countries that do too. I work for a CDMA carrier, but my posts do not necessarily reflect opinions of my employer, blah blah :)

Re:Yeah God Forbid They Actually Have to COMPETE (1)

Have Brain Will Rent (1031664) | more than 4 years ago | (#27714711)

You're lucky. Really. I want to get an Android to use in Canada. None of the carriers here support it. But I can buy the developer version. And I can buy a sim from one of the GSM carriers up here and plug it into the phone and it will work. Except the 3G. Because for some reason the carriers here elected to use a 3G frequency incompatible with both the US and Europe. Grrrrrr.....

Re:Yeah God Forbid They Actually Have to COMPETE (1)

Chabil Ha' (875116) | more than 4 years ago | (#27714573)

My experience has been not the bandwidth, but the processing power of the device itself. Slashdot comes up slower than a PC when even connected via WiFi.

Don't worry, AT&T (5, Insightful)

Daffy Duck (17350) | more than 4 years ago | (#27713621)

You have some breathing room. It will take Verizon at least a year to figure out how to disable all of the iPhone's features so their customers have to buy them back one at a time.

Re:Don't worry, AT&T (1)

DustyShadow (691635) | more than 4 years ago | (#27713689)

Good point but I would assume the iphone on verizon would be just like the blackberry. AFAIK, verizon doesn't lock down anything on the blackberries (except for maybe GPS. I'm not sure about that).

Re:Don't worry, AT&T (5, Informative)

aesiamun (862627) | more than 4 years ago | (#27713759)

GPS is locked out on my 8830 from Verizon. I needed to buy a bluetooth GPS device to go geocaching.

Re:Don't worry, AT&T (2, Insightful)

mysidia (191772) | more than 4 years ago | (#27713859)

If Verizon tried to pull something like that, i'm pretty sure Apple would just renew their agreement with AT&T.

They want to sell as many units as possible. It hurts Verizon so badly not to be able to sell iPhones, that they'll cave, and not demand any features be disabled.

Sure, Apple would make a deal to turn off features in a heartbeat if they could make a profit from it and it wouldn't sully their brand.

Letting Verizon cripple the iPhone, which is advertised as a computing device, not just a phone, could do just that...

Re:Don't worry, AT&T (5, Interesting)

93 Escort Wagon (326346) | more than 4 years ago | (#27714201)

If Verizon tried to pull something like that, i'm pretty sure Apple would just renew their agreement with AT&T.

Verizon WILL try to pull exactly that - they've demonstrated pretty much identical behavior to this many times. I left Verizon for T-Mobile because of it - when Verizon finally released its first Bluetooth phone, it disabled basic sync between a person's phone and his/her computer. I really wonder how many non-techie Verizon are blissfully unaware of some great features their Bluetooth phones would be capable of if only Verizon didn't disable them?

Now what I'd really like to see is the iPhone on T-Mobile's network...

Re:Don't worry, AT&T (3, Insightful)

SvnLyrBrto (62138) | more than 4 years ago | (#27714367)

Apple has caved to AT&T in ways that sully their brand before.

The biggest example is the in-store-activation-only fiasco with the 3G launch. Compare and contrast that experience versus the original iPhone; when you could go in, plonk down your money, get the hell out of there, go home, and activate at your leisure. That idiocy alone pretty much guarantees that as soon as the iPhone is available on another carrier, I'll be dropping AT&T.

Apple has also pulled apps from the store at AT&T's behest. And despite by "unlimited 3g data" plan, if I want to download the arger apps or podcast episodes; I can't do so over the cellular data network; I have to connect to WiFi.

Granted... *I* know that none of that is inherent to the iPhone itself; but to AT&T's asshattery. But I suspect that there are plenty of people out there who don't quite make the distinction between the two; and who see Apple as something less than they should because of it.

cya,
john

Re:Don't worry, AT&T (1)

edxwelch (600979) | more than 4 years ago | (#27715103)

> Apple has also pulled apps from the store at AT&T's behest.
Which apps?

Just curious

Re:Don't worry, AT&T (2, Interesting)

Divebus (860563) | more than 4 years ago | (#27714149)

HAH! That's why I detest Verizon and wouldn't mind trying AT&T. Verizon expects you to buy your own pictures back from them. I've [still] got one of those LG phones where Verizon forgot to turn off OBEX/OPP and I declined their generous offer for a free firmware upgrade.

Re:Don't worry, AT&T (1)

RoFLKOPTr (1294290) | more than 4 years ago | (#27714333)

You have some breathing room. It will take Verizon at least a year to figure out how to disable all of the iPhone's features so their customers have to buy them back one at a time.

You do have a good point, but I would like to point out that it really only counts on the Java phones. I just bought a Samsung Omnia a couple weeks ago (loving it btw, except shitty battery life... just plug it in every night and you're fine), which runs Windows Mobile, and I'm able to do everything on it that I was able to do with my Dell PDA. I don't need to install any software to get it to connect to my computer, and I have direct access to all the files on the device. I can drag any .cab over there and install it to my heart's content. They even gave me 8GB of internal storage to put my music and pictures on, and I can play it with whatever player I want to install. Also, even though Pandora is only supported on two specific phone models, you can still get it on any phone with some Googling.

So I don't know if Verizon chose not to lock the device down, or if it's just because Windows Mobile is closed source and they really can't lock the device down. Whatever the reason, it's not locked down to any extent. All the components are usable by any program free of charge.

Re:Don't worry, AT&T (2, Funny)

wickerprints (1094741) | more than 4 years ago | (#27714439)

It's the rare post where one cannot decide whether to mod +insightful, or +funny.

Re:Don't worry, AT&T (1)

flappinbooger (574405) | more than 4 years ago | (#27715021)

I was just thinking - I want an iphone. And, I want the verizon network.

Then you reminded me of something. I had (when it was good) a v3 from AT+T. Hackable goodness, everything there. Then we switched to a v3 from VZW. What happened to my phone? What's up with this horrible interface? Where are all the features? This isn't a v3, it's an upsell device with a good network and an ugly interface.

ATT's network is improving in this area and they just bought a local GSM provider, so I don't think it will be a problem.

Re:Don't worry, AT&T (2, Funny)

nomadic (141991) | more than 4 years ago | (#27715093)

I want a pony.

Re:Don't worry, AT&T (1)

Tweenk (1274968) | more than 4 years ago | (#27715095)

I'm glad this behavior is endemic to the US.

In my country there doesn't exist a word for tethering - if you have Internet access in your phone, everyone takes it for granted that you will be using that access from your computer rather than from your phone. That's why I wondered what the hell tethering is, and when I learned I was horrified.

On the other hand, 70% of WiFi access points in public places like galleries belong to one of the two big operators, and they charge batshit insane prices (~$3 for 1 hour of use) if you don't buy their monthly "mobile Internet" plan.

RE: GOD Forbid (0)

Anonymous Coward | more than 4 years ago | (#27713629)

God forbid there should be any benefit to the consumer.

CDMA / GSM (4, Insightful)

jmauro (32523) | more than 4 years ago | (#27713633)

I thought Verizon couldn't use the iPhone because it's GSM and Verizon uses CDMA. There isn't a CDMA version marketed anywhere in the world, they're all GSM. The only options in the US are AT&T and T-Mobile, any bid from any of the other companies would pretty much require them to front the cost of making a CDMA version of the phone since it'd only sell in the US.

Re:CDMA / GSM (5, Informative)

Anonymous Coward | more than 4 years ago | (#27713843)

Apple said from the beginning it did not want to use CDMA because of its limited range to only North America. GSM is used around the world. Verizon Wireless execs have recently said (check out macrumors and appleinsider.com for the specifics) they don't expect to make an offer to carry iPhones until they roll out 4G LTE technology (aka the next GSM version), the same 4G technology ATT is using.

You won't see an non-ATT iPhone until LTE hits.

Re:CDMA / GSM (2, Interesting)

Anonymous Coward | more than 4 years ago | (#27714613)

Apple went to Verizon first. They laughed them out of the room when Apple told them the terms.

Verizon does know one thing people are fickle. The terms Apple was asking for was too big of a risk at the time. They were just finishing ridding out the razr wave. Which was GSM first... Many of the phones that Verizon has are not exactly cutting edge phones. But they are tried and true phones. Meaning the return rates/attach rates/costs are understood up front. The only thing semi cutting edge about Verizon is their network. They want to get people on the 2 year plan. That means giving away a cheap phone, of which the iPhone is not. It would even be less so with the terms Apple came to them with. Verizonwireless is insanely profitable for a reason. Verizon is VERY methodical about the customer lock in. That is where they have been making money for years...

It would NOT be that big of a deal for Apple to stick a CDMA chip radio in there (I know of at least 3 chipsets that would work). You seem to think they cant have 2 versions of the iPhone? Many cell phone companies do exactly that.

AT&T on the other hand AT the time iPhone came out was not exactly the 'best' network. Coverage was spotty. Customer service was even more spotty. EDGE ruled their network and EVDO was blowing it away. They did know one thing Apple COULD make 2 versions of the phone. They learned that from Motorola with the razr. That is why there was an exclusivity clause. Not because Apple didnt have the technical knowledge to make a CDMA phone, or that CDMA was worse. It was all about money.

GSM may be world wide but it is also in some of the cheapest areas (because the phones chipsets are cheap to make). Such as India and many 3rd world countries. The iPhone is a 700 dollar phone. The sales there are probably rather low and rare. That leaves countries where CDMA and GSM are both in existence.

Just remember because your favorite company/phone uses GSM/CDMA means that it is the 'best'. GSM is turning into LTE thru HSPDA and so is CDMA thru WCDMA/EVDO. LTE is much closer tech wise to CDMA than others will lead you to believe. Notice who didnt really squeak about LTE, Qualcomm. They tried to push their own but when the market said LTE the said 'oh shucks darn, ok'. They are not out there bad mouthing it. They got behind it in a HUGE way...

Re:CDMA / GSM (1)

ottothecow (600101) | more than 4 years ago | (#27715141)

have you ever used a verizon razr and compared it to a at&t (then cingular) razr?

The verizon razr is a piece of crap. The phone is physically different (apparently it breaks more often and IMHO the slight keyboard layout change is awful). The motorola software is replaced with the shitty verizon interface that they put on all of their phones. The verizon camera is higher resolution (although it still sucks) but I wouldnt be surprised if bluetooth transfer was disabled so you had to pay to send yourself your pictures.

Re:CDMA / GSM (0, Troll)

rakslice (90330) | more than 4 years ago | (#27715341)

Presumably if every other major cell phone manufacturer can make pretty much identical phone models for GSM and CDMA, it can also by done by... Oh wait, it's Apple; nm. =)

Capitalism at its finest. (-1, Troll)

Anonymous Coward | more than 4 years ago | (#27713659)

I love the free, open market. None of that oppressive heavy-handed regulatory MOU crap they have between operators in Europe to screw over hardworking companies who are trying their very best to deliver good products to consumers.

Apple unlikely to make iPhone available to others (3, Informative)

elektrizitat (849866) | more than 4 years ago | (#27713667)

I would personally like to see the iPhone available on other carriers, but at least for now this doesn't look likely as Tim Cook has stated that he is happy staying with AT&T and GSM technology: http://www.appleinsider.com/articles/09/04/22/apple_happy_with_att_indicates_no_plans_for_cdma_iphone.html [appleinsider.com]

Re:Apple unlikely to make iPhone available to othe (1)

DustyShadow (691635) | more than 4 years ago | (#27713705)

It makes sense for him to say they are happy with ATT. If he said they were not happy or if they were planning on offering to other customers, potential iphone buyers may be tempted to wait it out.

Re:Apple unlikely to make iPhone available to othe (1)

BlueF (550601) | more than 4 years ago | (#27713753)

This is really too bad. Out of every carrier I've used in the last 5 years -- Edge, US Cellular, Sprint, Verizon, T-mobile, then AT&T -- Verizon has seemed the most solid. I am always on the brink of going back to Verizon, were it not for the boring but entirely functional razr. No other phone seems worth using for cool factor other than the iPhone. Too bad it's proven to be such a trade off for reliability.

Not news, not for nerds (-1, Flamebait)

tsa (15680) | more than 4 years ago | (#27713719)

This is not news of course. Neither is it really nerd stuff. It's simple economics. What's this doing on Slashdot?

Re:Not news, not for nerds (0)

Anonymous Coward | more than 4 years ago | (#27713741)

Because Slashdot nerds think they are economists. Just look at all the free-market libertarian bullshit around here.

Aren't iPhone sales down? (1)

IANAAC (692242) | more than 4 years ago | (#27713739)

I know that Apple's overall revenue is up, but aren't their iPhone sales down substantially (albeit, expected)?

I think, at least until another model ships, iPhone sales have peaked in the US.

Re:Aren't iPhone sales down? (2, Informative)

Anonymous Coward | more than 4 years ago | (#27713891)

No.

Sold 3.79 million last quarter; a 123% growth over the same quarter last year.

Re:Aren't iPhone sales down? (1, Insightful)

koiransuklaa (1502579) | more than 4 years ago | (#27714271)

Comparing to a year ago is fine, but you know what they say about statistics... Let me tweak your comment just a bit (it's still factually correct):

Sold 3.79 million last quarter; a 45% drop in two quarters.

Not nearly as impressive anymore, is it? I always get suspicious when I see a specific percentage figures used like Apple often do in their result announcements... It's childishly easy to find a single large figure that looks good (especially in a market like this) and the media and bloggers seem to all happily repeat the same number over and over: 123% growth! Wow, 123%!

Re:Aren't iPhone sales down? (1)

Xuranova (160813) | more than 4 years ago | (#27714529)

but all companies compare to the same time the previous year. This isn't some random metric Apple made up. I'm sure Apple would like to take credit for a making a metric all companies use but they can't.

Re:Aren't iPhone sales down? (0)

PopeRatzo (965947) | more than 4 years ago | (#27714549)

a 123% growth over the same quarter last year.

This is the kind of statistic you would hear from a divisional vice-president to stockholders when their sales were tanking. "Look! We're up from the same time last year! Forget about the fact that we're way behind the last two quarters, it's all about how much better we are than a year ago! And we're selling infinitely more iPhones than we sold in 1999!"

Re:Aren't iPhone sales down? (2, Insightful)

chaim79 (898507) | more than 4 years ago | (#27715263)

Look at any quarterly sales report from just about any company and you will see a pattern for the quarters, it's almost never a steady anything (rise, loss, flat-line) it's always fluctuating by quarter. That's why it's customary to compare against the same quarter last year, it would be the same part of the fluctuation and would more accurately reflect a rise or fall.

what that means for us (1)

v1 (525388) | more than 4 years ago | (#27713745)

is the price of the iphone should drop because AT&T is paying more into the kickback fund at Cupertino.

I don't see this as a particularly bad thing, as long as AT&T doesn't hike their contract cost to offset it. Chip away some of that 26% and put it back in my pocket thx.

Re:what that means for us (1)

PopeRatzo (965947) | more than 4 years ago | (#27714569)

is the price of the iphone should drop because AT&T is paying more into the kickback fund at Cupertino.

I don't see this as a particularly bad thing, as long as AT&T doesn't hike their contract cost to offset it. Chip away some of that 26% and put it back in my pocket thx.

Both of those things have already happened: iphone price drop and AT&T contract rate. You can bet that both of those things will happen again.

Whoever writes the biggest check will lose (1)

cavehobbit (652751) | more than 4 years ago | (#27713791)

Rim, Nokia, HTC, Sony-Ericsson, Samsung, every phone maker is bringing out competing products, if they have not already.

There is maybe 1 more year of dominance by Apple here, then it's over.

If I was ATT, I would let Verizon overbid to get a share of the I-phone market, then promote competing products that have the same capabilities.

It would help if they upgraded their network more quickly to handle the traffic though.

Re:Whoever writes the biggest check will lose (5, Insightful)

Brett Buck (811747) | more than 4 years ago | (#27714025)

Rim, Nokia, HTC, Sony-Ericsson, Samsung, every phone maker is bringing out competing products, if they have not already.

There is maybe 1 more year of dominance by Apple here, then it's over.

Sounds a lot like....

No wireless. Less space than a nomad. Lame.

      Brett

Re:Whoever writes the biggest check will lose (1)

LordLimecat (1103839) | more than 4 years ago | (#27714277)

Wait, are you implying a blackberry doesnt have wifi? Because I think thats just incorrect (seeing as I have a blackberry right next to me on my WPA2-AES wifi).

Re:Whoever writes the biggest check will lose (1)

Brett Buck (811747) | more than 4 years ago | (#27714797)

Merely suggesting that the same sort of analysis being applied to the iPhone and its impending "demise" was originally applied to the iPod by no less a slashdot personage as CmdrTaco. We all see how that turned out.

Point being, people keep trying to pooh-pooh the various Apple products based strictly on perceptions of technical merit, and they keep being proved utterly and completely wrong.

        Brett

Re:Whoever writes the biggest check will lose (0)

Anonymous Coward | more than 4 years ago | (#27714035)

There are plenty of media players that compete with the ipod, yet the ipod still sells no problem. Apple has excellent marketing and ability to lock you in so that you BELIEVE (whether true or not) that you need their products.

I predict that once the iPhone is available on other US carriers, the holdouts that refused to switch to AT&T for the iPhone will flock to it. Expanding market availability would only strengthen Apple, even if there are very good competing products.

Re:Whoever writes the biggest check will lose (1)

Xuranova (160813) | more than 4 years ago | (#27714451)

This comment will be saved and referenced in one year.

Re:Whoever writes the biggest check will lose (1)

dreamt (14798) | more than 4 years ago | (#27714629)

Like the Storm? I tried to use the Storm and it was awful. I switched to AT&T and the iPhone.

it makes sense (1)

bravo369 (853579) | more than 4 years ago | (#27713841)

It makes sense. The iphone has grown on me but not enough to switch to AT&T. if Verizon gets it then it will be something I consider

and of course the consumer loses (1)

jessejay356 (625312) | more than 4 years ago | (#27713903)

Since they will be paying some ridiculous amount to Apple, they have no reason to give good deals on the phone and service. Like AT&T they will have an "iPhone" tax. $70 a month seems high to me, yet is the cheapest plan you can get. Why not a $40 more limited plan? They don't nearly as much then!?!

Re:and of course the consumer loses (1)

what about (730877) | more than 4 years ago | (#27713985)

Your are of course right, the customer pays it all, as always.

This is why it is extremly important to have at least two players in the market, symbian is not competitor for iPhone, Google may be.
(I own a nokia E90, nice hardware, can be better software, extremly expensive ....)

On a related matter, just to give you an idea, in Italy, now, I pay 25euros/month to Wind to have
350minutes/month, billed by the second, no rx charge, no connection charge (any italian telephone)
100SMS each month
1Gb month internet browsing/email/whatever (I can tether my PC using the E90)

I have to add 12euros/month taxes (this money go to the gov.) and 20% VAT
(Yes, I know, we are taxed to death)

Verizon rejected.... (5, Insightful)

phantomfive (622387) | more than 4 years ago | (#27713931)

Verizon rejected the iPhone in the beginning, and they will do it again for the same reason: they want control over their network. They don't want to become just a dumb pipe, because then they are a commodity. Apple having complete control over the iPhone sets a dangerous precedent, it was the first time a phone maker had so much control.

From my perspective the commoditization of the networks can't happen soon enough. The network maintainers SHOULD be separated from the service providers, and the service providers should lease the network from the maintainers, like Virgin Mobile does now. This will increase competition, and be the best for the customer. The same thing should happen with internet service.

Re:Verizon rejected.... (1)

Weedhopper (168515) | more than 4 years ago | (#27713991)

While the latter half of you post may have merit, it is invalidated by the fact that Verizon never had a chance to reject the iPhone because the iPhone never would have worked in the Verizon network. Different technologies. Apple never seriously considered making a CDMA phone.

Re:Verizon rejected.... (5, Informative)

phantomfive (622387) | more than 4 years ago | (#27714193)

Switching from a GSM phone to a CDMA phone is simple, on the software side it's a matter of changing a few low level AT commands, and on the hardware side it's a matter of swapping out the modem. If Apple chooses to do it, they will.

Furthermore, you've done bad research. Not only did Apple consider making a CDMA phone, Verizon completely rejected them [engadget.com] . In essence neither the latter half nor the former half of your post has merit.

Re:Verizon rejected.... (1)

Weedhopper (168515) | more than 4 years ago | (#27714457)

Re:Verizon rejected.... (1)

GizmoToy (450886) | more than 4 years ago | (#27715181)

How does "Apple may be more likely to work with us once we roll out LTE" invalidate the fact Apple approached Verizon before AT&T? Verizon's VP confirmed they turned Apple down when the two companies couldn't agree on a deal.

phantomfive is exactly correct. Even swapping out the chipsets is relatively straightforward. There are hundreds or thousands of phones that do just that, many from companies smaller than Apple. The hurdle is not technical, as you imply.

Re:Verizon rejected.... (1)

Weedhopper (168515) | more than 4 years ago | (#27715317)

Okay, if I'm wrong, I stand corrected.

Actually, now that I think about it and I do remember reading about the Verizon thing, so I know I'm wrong.

But there's been multiple articles in the recent past from multiple sources that have quoted Verizon execs as saying that Apple never seriously considered a CDMA phone. That's fresh in my mind.

To me, this is conflicting information.

Re:Verizon rejected.... (2, Insightful)

andy1307 (656570) | more than 4 years ago | (#27714191)

Wireless companies are all about subscribers/quarter. There is no way Verizon will pass up on an opportunity to keep their numbers up. Take a look at what's happening to Sprint-Nextel.

Re:Verizon rejected.... (1)

ukyoCE (106879) | more than 4 years ago | (#27714789)

This attitude won't last forever. Arguably, it's already over. Verizon has made a lot of concessions on their smart phones. And they know they're bleeding customers to AT&T despite AT&T's crappier network.

AT&T doesn't get a signal inside buildings in my region, so I'm hoping Verizon will wise up...

not necessarily verizon (1, Interesting)

fermion (181285) | more than 4 years ago | (#27713967)

It was always my belief that verizon did not want the iPhone because it was not a good fit. Verizon always seemed to me, at least traditionally, to cater to a group of people who did not paying more for cell phone service, and their policies do tend to limit customers, at least in my experiece. It seems that this would be the Apple group, but it really isn't, because Apple does try to reach out to all potential customers, something Verizon has only started recently.

Before the iPhone, and after all the mergers of the mobile companies in the US, ATT and Verizon had about each shares, maybe a bit more than 25%, and t-mobile was just barely in double digits, and the new companies, like boost and cricket were barely on the radar. It is my opinion that these later companies are where the growth is going to be, not Verizon.

The only reason people are talking about Verizon is because people know with Verizon want an iPhone. I don't know why. Everyone says it is just another phone, and they can go get a G1 from t-mobile, or a superior blackberry from Verizon, or a cheap phone from the other dealers, but some people seemed really annoyed they can't get a iphone from verizon.

There is a reason for this. In the US every carrier wants a custom phone, and they want a custom phone with sub custom features. You know how you can update the phone now? It would be more difficult and more confusing if Verizon got it pesky fingers on it.

The other reason is that there would be little benifit to apple. There would be no differentiation, but there would be added expense of producing a phone with either extra circuitry or two phones, again confusing the public.

Here is what te next iPhone should do. A $99 phone sold through boost and cricket. Here is why. Right now it is reported tat 90% of teens with an MP3 player has an iPod. As they grow up, they will continue to buy iPods, and will likely upgrade from the models they use know. They start with a shuffle, continue with a mini, then buy an iPhone. It works for cigarettes, why not music players. It would make sense to apple to make a phone so that the first phone will be an iPhone mini.

What do many parents want? Control over the phone. We have parental controls in Mac OS X, why not the iphone? What do kids want, unlimited text. Both want no contract. Some families have the resources to pay $200 for a phone and already have a family plan, but other do not. Will Verizon allow apple to leverage this base? No. It will only help with the business user than wants a blackberry, so why bother.

Maybe in a vacuum? (1)

crhylove (205956) | more than 4 years ago | (#27714083)

There is NO WAY I'm paying the exorbitant fees for at&t/apple.

I KNOW I'm not alone. Most of my friends/family/coworkers are all agreed: They're waiting for an iPhone killer that isn't encumbered by DRM and the lock in. Plus the monthly plans are way too high.

The moment there's a good iPhone killer and cheaper monthly plans (I'm looking at what the G1 SHOULD have been), everyone will get that.

My dream phone:
Looks like an iphone, but it has:
a full FOSS stack, including media viewing/listening, an SDHC slot, a headphone jack, a standard USB jack, GPS, a SNES emulator, and a camera on both sides so I can skype where wifi is available.

It's not rocket science, you could have this phone out in numbers for $100 at volume.

It's ludicrous that none of the apple competitors have put one out yet.

Re:Maybe in a vacuum? (0)

Anonymous Coward | more than 4 years ago | (#27714329)

Yes just ludicrous. It's such an obvious and easy way to just scoop up the entire smart phone market.

Guess why you called it your "dream" phone.

Re:Maybe in a vacuum? (0)

Anonymous Coward | more than 4 years ago | (#27714969)

It's almost as though it's not as simple as you think it is.

Re:Maybe in a vacuum? (0)

Anonymous Coward | more than 4 years ago | (#27715051)

My dream phone:
Looks like an iphone, but it has:
a full FOSS stack, including media viewing/listening, an SDHC slot, a headphone jack, a standard USB jack, GPS, a SNES emulator, and a camera on both sides so I can skype where wifi is available.
It's not rocket science, you could have this phone out in numbers for $100 at volume.
It's ludicrous that none of the apple competitors have put one out yet.

Dumb ass.

90$/month (0, Redundant)

andy1307 (656570) | more than 4 years ago | (#27714125)

That's the average? I pay around 75$/month.

AT&T Crappy Service (2, Informative)

Nom du Keyboard (633989) | more than 4 years ago | (#27714263)

If AT&T can't hold their customers away from Verizon (and all the current customers are locked into 2 year contracts with nasty termination fees) it's because of their crappy service and high rates. If they fixed that then they would need to worry about the competition so much. In fact, competition is exactly their problem - they don't want any!

Re:AT&T Crappy Service (2, Interesting)

anjilslaire (968692) | more than 4 years ago | (#27714491)

Indeed. I was on AT&T a year or so ago, when they announced they were prorating the early term fees. I had about 2 months left, my phone was acting up, and th wife wanted verizon because all of her family uses it, so no minutes would be used.

So figuring I'd eat the prorated fees, I called to cancel. The phone support said the pro-rating was for new customers only. Now remember, new users get 30 days to cancel, so why give them prorated fees, and not existing users. After an hour on th phone with 3 different people, I finally said "Fine. Charge me, I want to cancel my service on principal now. I'll pay your fees and never use your service again. Also, be aware that I'll be filing a complaint with the BBB", and ended the call on a stiff but polite note.

I went to BBB.org and found a fantastic online form that allowed me to explain everything, with account numbers, etc. 3 days later I received a call from Executive Support at AT&T, apologizing for the issue that should have been solved (prorated) at T1. They negated my ETFs and actually pro-rated my final month of service bill too. Long story short: The Better Business Bureau actually works.

Already at the saturation point (-1, Troll)

Anonymous Coward | more than 4 years ago | (#27714341)

Only NSAT&T can afford to ignore the obvious from a pure business perspective, but that aspect's just for show with NSAT&T.

-- Freedom's just another word for nothing left to lose.

Apple doesn't want to make different iphone models (5, Insightful)

alen (225700) | more than 4 years ago | (#27714355)

just like with computers, apple wants to make only minor variations of a model. for the iphone it's how much storage you want. with their computers it's only a few minor variations as well.

more choices means more expensive to produce, more testing, etc. Less profits due to higher costs.

and with CDMA, why make a phone for a dying technology?

Verizon turned down the iPhone (1)

SeaDuck79 (851025) | more than 4 years ago | (#27714493)

I spoke to a Verizon rep about this about a year ago. He said that Apple and Verizon were talking about an exclusive agreement before they went with AT&T, but the money wasn't right for Verizon to do the deal.

I understand that the major complaint from most iPhone users is the network, and Verizon's is the best, but is that enough to warrant the agreement with Apple, now that Verizon is doing pretty well with the BB Storm and some of the other competitors?

Frankly, I think that losing the iPhone would kill AT&T as a major competitor. The iPhone is really about the only reason to consider them as a network.

I don't understand (0, Troll)

buss_error (142273) | more than 4 years ago | (#27714577)

why the iPhone is so popular. I looked at it, sure, it's nice, but the price is so high I can't justify buying one - let alone the monthly charge.

On the other hand, I want a phone. I don't want a camera, music player, handheld computer, contact manager, schedule keeper, blah blah blah. I want a phone. I want a phone to make phone calls. It's nice if it keeps a phone book, but the numbers I need, I know. Most of the time, (not the case with the iPhone, mostly) these "multi-tool" tech things don't do ANYTHING very well, though they do a lot.

Apple is an unamerican, anticompetitive company .. (3, Funny)

Anonymous Coward | more than 4 years ago | (#27714589)

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:Apple is an unamerican, anticompetitive company (3, Insightful)

troll8901 (1397145) | more than 4 years ago | (#27715357)

This comment is rated Funny. I've reread this twice, but I still don't understand the joke. Can someone explain it to me please?

disgusting (1)

Komaji (1134667) | more than 4 years ago | (#27714761)

These companies gouge and placate their "valued" customers. They only care about just how far they can reach into our pockets. So here they are now scrambling for a bigger piece or to protect their monopolistic cartels.

Seriously? (1)

theantipode (664138) | more than 4 years ago | (#27715255)

I might have considered the iPhone if it were on any other network. It was this lone limiting factor that kept me from putting down the extra coin. I'd make the wiretapping argument, but Verizon is equally as guilty.

why doesn't AT&T advertise iPhone? (1)

swell (195815) | more than 4 years ago | (#27715413)

Doesn't it seem logical that if the phone is a big money maker they would want to promote it?

Here in California I have seen many AT&T ads for other brands of cell phones. Never for the iPhone. Is it different where you live?

Come to think of it I've seen many Apple ads for the iPhone and AT&T is never mentioned.

So, if these guys are making each other rich, why aren't they more friendly to each other? Makes me doubt the NYT analysis.

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