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Apple Can't Afford iPhone's Carrier Exclusivity

Zonk posted more than 6 years ago | from the we-like-even-meaningless-choices dept.

Cellphones 371

WirePosted writes with an ITWire article about the problems that Apple's AT&T exclusivity deal could pose in the coming years. Initially the company needed AT&T's commitment to the project, to ensure features like visual voicemail would work. With the iPhone a hit even at its current high price that no longer seems to be the case. Can Apple afford to stick to an exclusive carrier in the future? If for no other reason than consumer choice? "iPhones are being sold unlocked in the markets of Asia where you can't get them with a carrier plan, but they're also being bought and unlocked in the US and Europe. The message is that many and probably most iPhone buyers would like to be given a choice of carrier when they buy their iPhone. Some would be prepared to pay more as they do with other smartphones and buy their iPhone unattached to any subsidized carrier contract. The point is many consumers feel no loyalty to carriers and resent being forced to choose one."

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There's more here than meets the eye (4, Insightful)

daveschroeder (516195) | more than 6 years ago | (#22283954)

It's not just visual voicemail, people. Jeez, if I had a dime for every time I heard that used as the only putative reason that Apple is tied to AT&T...

It's also having structured, simple unlimited data plans, which is really what makes the iPhone shine.

It's about doing things like setting your voicemail greeting all through a GUI on the phone, without having to call into some number and follow prompts. (Simple? Sure. Not a big deal? Sure. But still, one little detail among many.)

It's being able to walk out of a retailer with the iPhone sealed in a box (which itself probably has more attention to design than most handsets do), and then the ability to seamlessly activate via iTunes, with a simple selection of choices, in the comfort of one's own home in a fashion fully supported by Apple and the carrier.

It's about expanding the iTunes/iPod/iPhone/iTunes Store ecosystem with a carefully planned strategy.

It's the user experience from end-to-end (peoples' own individual gripes with AT&T or any other carrier aside).

That's the issue, and all of those things take a lot of backend work and cooperation between Apple and the carrier. It's not just a handset; it's a complete end-user experience from purchase, to activation, to use.

And yes, some customers might not "care" about all of these things. The power users, the hackers, the cutting edge geeks. But normal customers are a much larger target, and those are the people reading reviews, and those are the people who will drive to Apple's goal of 10 million iPhones. With wildly varying user experience and differences from carrier to carrier, how will the iPhone be viewed in the eyes of the iPod-buying populace?

And remember, contrary to the article's assertion, since owning an iPhone isn't mandatory, and we presumably have free will, no one is "forced" to do anything.

What about this is so difficult to comprehend?

That, and the fact that AT&T may be giving Apple as much as $200 per activated iPhone, and then 3%/month for existing customers and a staggering 9%/month for new customers on top of it, so that the end-user cost when people buy one in a store is manageable? Yeah, the iPhone might not be "subsidized" in wireless industry parlance, but you bet your ass it's "subsidized".

There's more going on here than "evil Apple" wanting "lock in". Like all products with Apple, it's about more than just buying a commodity...it's getting a pleasant experience along with it, from end-to-end. (Yeah, yeah, insert a billion gripes about how the iPhone sucks for one reason or another here. Go tell that to Google's CEO, who says the iPhone is the first of an entire new generation of products. Yes, this platform really is that special, no matter how much you, personally, might hate Apple, the iPhone, or both.)

Apple has also shown it does these sorts of things -- and going into the mobile handset business is a HUGE foray -- in baby steps. Is it any surprise that the stage we're at now has carrier exclusivity for a variety of reasons, even beyond what I've already articulated above? Just because YOU don't like it or some IT rag pundit waxes philosophic about it doesn't mean it's not the right business decision for Apple at the present juncture. It doesn't matter how many people buy iPhones to unlock them. There is a vibrant unlocking and hacking community for just about any desirable phone, including ones not available in particular markets, etc.

It may be that someday, Apple really can't "afford" carrier exclusivity. And you know what? I'd imagine we'll see a change, then, won't we?

Re:There's more here than meets the eye (4, Insightful)

Brian Gordon (987471) | more than 6 years ago | (#22284088)

(This came out a lot like flamebait, but please people read the parent and then understand my raged) What, you're defending carrier exclusivity? All those things are terrible ideas and have no place in a phone for crying out loud. Expanding itunes to the iphone? What? Anyway that should be done through apple, and the carrier would make no difference.. if the iphone can connect to a web site then it can run a little itunes app that connects to apple servers, REGARDLESS of carrier.

And remember, contrary to the article's assertion, since owning an iPhone isn't mandatory, and we presumably have free will, no one is "forced" to do anything.
Durrr have you forgotten the people who want iphones and don't want AT&T? That's what this whole hullabaloo is about. Apple's "pleasant experience end to end" is wrong and it can't realistically expect to control things all the way to the user. It's an absolutely godawful idea on their macs- making software that's written to run on any x86 platform and then locking it down to only run on one set of hardware? Same with phones- if apple wants to make a phone that's fine but what is it doing controlling carriers? Why does the designer of the phone have any say at all as to who can service it? That makes no. sense. at. all. Apple shouldn't worry about people confusing crappy service with crappy hardware- anyone with half a brain can tell that the maker of a phone has nothing to do with the huge phone bill.. but I guess people with at least half a brain isn't Apple's target audience, is it?

Re:There's more here than meets the eye (1, Insightful)

Anonymous Coward | more than 6 years ago | (#22284228)

Apple's audience is mostly made up of people who crave the status of owning a trendy, hip device. People with half a brain will appreciate many things about Apple's products but hardly worship them or use them exclusively.

Re:There's more here than meets the eye (3, Insightful)

Brian Gordon (987471) | more than 6 years ago | (#22284298)

But without workipping them how can you justify being locked into AT&T for two years while literally _the rest of the entire world_ does nothing of the sort? And paying $600 off the bat for mediocre hardware that's so locked down you can't even change the battery, or install programs not paying a billon dollars to Apple for signing, without feeling like a criminal from all the DMCA filth spewed by Apple?

Re:There's more here than meets the eye (1, Offtopic)

peragrin (659227) | more than 6 years ago | (#22284450)

Because if you want a cellphone in the USA you have no other choice.

Because if you want any kind of feature in your phone you have to sign a contract.

Because in the USA the cell phone played out differently than elsewhere.

sure it sucks, but in the end two year contracts aren't all that bad. They can't randomly raise your rates either. Apple is playing ball with the cell phone companies or else the iPhone would never have gotten to market, just like all the really cool phones from japan take 3-4 years before they reach the USA.

Re:There's more here than meets the eye (-1, Troll)

Anonymous Coward | more than 6 years ago | (#22284712)

That's exactly it; the poseurs who like being trendy DO worship them and accept and crap they are fed. The people with half a brain don't.

Re:There's more here than meets the eye (5, Insightful)

reidconti (219106) | more than 6 years ago | (#22284992)

But without workipping them how can you justify being locked into AT&T for two years while literally _the rest of the entire world_ does nothing of the sort? And paying $600 off the bat for mediocre hardware that's so locked down you can't even change the battery, or install programs not paying a billon dollars to Apple for signing, without feeling like a criminal from all the DMCA filth spewed by Apple?
Because you are making an invalid comparison.

My choices are not:
* Buy iPhone from AT&T in the USA
OR
* Move to Europe and get some other cell phone there.

My choices ARE:
* Buy iPhone from AT&T in the USA
OR
* Buy much crappier smartphone, also with 2 year contract with some carrier I may or may not like
OR
* Buy utilitarian phone, also with a 2 year contract so that the phone is subsidized.

I bought an iPhone for $399 (you know; what they *actually* cost, not $600). I don't see the big deal. My previous phone cost $150 for a "dumb" phone thru Verizon with 2 year contract, and Verizon is the devil.

Unlike most Americans, though, I'm not used to contracts because in the past I bought unlocked GSM phones from eBay and used them sans contract on Cingular (so I was actually happy to have the iPhone excuse to ditch Verizon and their crappy call quality and dropped calls at busy times). Back when the Ericsson T39 was hot, I bought it new on eBay from the UK, I think i paid $299. My next phone (4 years later) was a Samsung D50 slider that was just a little under $400. So $400 for the iPhone was no issue. I don't particularly like being stuck with a contract, but I've used AT&T before and am more than happy to stay with them for 2 years. Frankly, compared to the rest of the market, what I get for $400 is so much more than I've gotten in the past. Both my previous expensive phones were very nice and everything, but they weren't above and beyond different from the competition like the iPhone. And I've used Windows Mobile, for 2 weeks, before I got rid of the phone out of utter frustration.

Just a guess (0)

Anonymous Coward | more than 6 years ago | (#22284326)

You own exactly 0 Apple products.

Re:There's more here than meets the eye (5, Insightful)

foxtrot (14140) | more than 6 years ago | (#22284418)

Apple's "pleasant experience end to end" is wrong

Indeed. I really hate it when people make things that don't suck. I mean, come on, companies of America. Bring me stuff that's unpleasant. I want the suck!

Why does the designer of the phone have any say at all as to who can service it?

I don't know, perhaps the designer of the phone has features they want to include that aren't part of the standard feature set? Like being able to activate at home without having to wait for a sales droid. Or visual voicemail. Or perhaps they don't want customers of their phones to have to wade through a sea of bizarre contracts and options? But again, that's part of that pleasant experience that you think is wrong.

Re:There's more here than meets the eye (2, Insightful)

Brian Gordon (987471) | more than 6 years ago | (#22284462)

Activate at home? Oh, you mean by installing a proprietary music store application (btw why on earth does a music store have to be an application instead of a website?) which has nothing to do with the phone on the computer you might not own? Right.

perhaps they don't want customers of their phones to have to wade through a sea of bizarre contracts and options
Perhaps my point is exactly that it doesnt matter what Apple thinks. They make phones, not offer cell service, and it's none of their business what contracts and options the customer has to deal with. Apple just has to have its tentacles wrapped around every little detail of every industry in which they have absolutely no control.

Re:There's more here than meets the eye (4, Informative)

Nicholas Evans (731773) | more than 6 years ago | (#22284568)

Activate at home? Oh, you mean by installing a proprietary music store application (btw why on earth does a music store have to be an application instead of a website?) which has nothing to do with the phone on the computer you might not own? Right.

What did Steve Jobs do you to you, run your dog down? Jesus. I have my iPhone box right here. Did you know that it says you need a PC with Windows or a Mac and you need to have iTunes installed to use the product? It's not like Apple is dropping their evil proprietary software onto your machine when you plug your phone in without any warning.

Being able to activate myself is convenient. I liked that. I was an existing AT&T customer who had never had any problems with them - I've had some horrible piece of shit phone with them for five years or so before I switched to the iPhone. I've still never had any problems with them. Hell, I haven't -talked- to someone from AT&T about my service, ever. They send me a bill and I pay it. No bullshit involved.

I don't quite know why you're frothing at the mouth. Yes, there's some lock-in. That's advertised straight-up. You need iTunes; you need an AT&T contract. Don't like it? Then vote with your wallet and buy something else.

Re:There's more here than meets the eye (1, Troll)

edmicman (830206) | more than 6 years ago | (#22284976)

Wait, so in order to use the friggin' *PHONE* I am forced to have a computer??

Re:There's more here than meets the eye (1)

xaxa (988988) | more than 6 years ago | (#22285034)

Activate at home?
What is this activation stuff? Last time I bought a contract phone I took it home, opened the box, saw the "please charge me!" thing and plugged it in. It was then ready to use. There were some instructions about inserting SIM cards, but all that was already done for me. This is in the UK, and not for an iPhone. Is this activation just for the iPhone, or for all phones in the USA?

Re:There's more here than meets the eye (1)

xaxa (988988) | more than 6 years ago | (#22285074)

Ah, a comment further down tells me that GSM phones don't need activation, which is why I've never heard of it in the UK (I don't know if the iPhone needs activating if it's purchased in the UK).

Re:There's more here than meets the eye (2, Insightful)

bigstrat2003 (1058574) | more than 6 years ago | (#22284518)

But again, that's part of that pleasant experience that you think is wrong.
No, it's part of control. This isn't surprising, as there's no company on the face of the planet which is more of a control freak than Apple, but it's still about control, not a "pleasant experience". Apple wants you to use their products in exactly the way they see fit, when they see fit, if they see fit. And that, I submit, is what's wrong here.

No one has a problem with a pleasant experience, despite your idiotic interpretation to the contrary. What we have a problem with is the practices Apple is using. They are hardly necessary to ensure a pleasant user experience, and never have been. Apple just chooses to take the easy way.

Re:There's more here than meets the eye (4, Insightful)

bberens (965711) | more than 6 years ago | (#22284750)

Apple as a great understanding of the paradox of choice [amazon.com] . This is exactly why Apple customers are so damned happy even though they have so very few choices of hardware options when compared to alternative vendors. If it really gets your goat that you don't have enough options, you probably aren't in Apple's target market. That's okay though, there's no need to bash them. I don't own any Apple products either.

Re:There's more here than meets the eye (2, Interesting)

gilesjuk (604902) | more than 6 years ago | (#22285032)

They want control because without control the phone companies ruin the devices and make them suck.

Vodaphone and T-Mobile are two operators that remove features from phones and hack about with the firmware purely because the phones have a feature that would save the end user some money.

It's about time a phone maker stood up to these phone operators, they are overcharging people and they've held back development of easier to use phones and convenient features.

Notion of phone activation, not GSM-like (3, Insightful)

Midnight Thunder (17205) | more than 6 years ago | (#22284634)

Like being able to activate at home without having to wait for a sales droid.

The whole notion of phone activation is very CDMA like and is not part of the usual GSM experience. The only thing that should take activating is the phone account, and then you are free to move your SIM card from phone to phone. I have never need to activate any GSM phone I have got, so why should I need to do this with the iPhone.

The iPhone has got many things right, but this does not make it a perfect phone. There are still missing features, that some people take for granted in GSM phones, like being able to transmit files and contacts via Bluetooth and MMS messaging, amongst others. Hopefully Apple will correct this or the competition will offer something that is even better, for us to lust over.

Re:Notion of phone activation, not GSM-like (1)

nevali (942731) | more than 6 years ago | (#22285066)

You don't need to activate the specific device with GSM, but you do normally need to activate the SIM/your account, which for 99.9% of consumers amounts to exactly the same thing.

Re:There's more here than meets the eye (1)

webmaster404 (1148909) | more than 6 years ago | (#22284660)

I don't know about anyone else but I want hardware/software not an "experience" from Apple. For example the iPhone/Mac are innovative, they have good hardware that looks nice and you can get good support from them and a decent OS that you don't feel like you want to either install something else or make it usable (like what you almost have to do with a new computer with Windows on it) however why does the service have to be part of the product? When I buy a land-line phone all I have to do is plug it into the phone jack and it will work just as fine on *insert phone company here* as *insert phone company here* not to mention when I switch phone companies I can use the same phone. Activating at home is in my opinion a stupid move to bring an "experience" to the product, it would be ideal had it been web-based that you only had to navigate your browser to a page but when it is an application to install (not one that is cross-platform either) it is nothing more then a hassle when your obviously in the store buying the phone another 10 minutes to sign some papers and get the phone to work isn't going to kill you.

Or perhaps they don't want customers of their phones to have to wade through a sea of bizarre contracts and options?


That's exactly what I hate about Apple's "experience" is the lack of options, sure to someone a remote with one button makes it easier to switch channels however it would be terribly inefficient and not ideal for everybody. It is always a bad idea to try to make something easier by taking out options it only makes it more complex to get what you want. AT&T has decent enough coverage around the US however they have sky-high prices, other cell providers may only work in a few cities, but if you only travel a bit and they can save you $200 a year it would be foolish to take AT&T just like Apple is suggesting to remove options to make it easier.

Overall, I just want hardware/software that works right, the iPhone is innovative and I would get it but as with all of Apple's products you can't just get the thing you have to suffer with Steve Job's "experience" to get a decent phone and even then you can't use it on the network you want.

Re:There's more here than meets the eye (3, Insightful)

schnell (163007) | more than 6 years ago | (#22284810)

I don't know about anyone else but I want hardware/software not an "experience" from Apple.

Then you don't want Apple, period. Apple's whole raison d'etre is to create a simple and elegant user experience out of complicated computer-related tasks. Apple is not interested in making the fastest or cheapest commodity computer product for other people to customize. Apple creates value to people who want their technology to "just work" by covering the whole product lifecycle with a system that - surprise - as a result limits choice! You want to deeply customize and significantly control your technology experience - you are not Apple's target customer. Buy another phone - you will be happier and Apple won't care or notice.

Seriously - if you want to buy an iPhone and complain about how you can't put Ubuntu on it or something, please don't bother. You're just wasting money and time. Just go buy some commodity hardware from somebody else who doesn't care about "experiences" - it will be cheaper and everybody will be happier.

Re:There's more here than meets the eye (5, Insightful)

wickerprints (1094741) | more than 6 years ago | (#22284468)

I can't respect the reasoning of someone who says that the end-to-end user experience is irrelevant or that the desire to design it is wrong or unrealistic--and then, in the same breath, talk about all the people who want iPhones. It's the same kind of thinking as people who say iPods should support WMA just because they're popular.

To be absolutely clear--the whole REASON why there's such demand for Apple products is because, unlike many tech companies, they DO care about the entire user experience. It makes using the product simple, easy, convenient. Would people buy Apple products if they WEREN'T easy to use, if that end-to-end experience WASN'T designed? It frustrates me to no end to hear people gripe about "user choice and freedom" but at the same time they covet the simplicity and elegance of Apple's design approach, not realizing that their interfaces and hardware are what they are precisely because it doesn't allow you to customize the crap out of it and ultimately break it in a million ways.

I've owned products by many different companies--Motorola, Samsung, Sony (and those are just mobile phones). And not a single one of them has been anywhere near as successful at designing a mobile phone interface as Apple has. It is called attention to detail. As a former loyal T-Mobile customer, do you think I was happy about having to switch to AT&T for an iPhone? I weighed my decision carefully, and like a mature adult, I made an informed choice. I am not sitting around with my old crappy UNLOCKED Motorola V3x with an indecipherable interface, whining about how the choices presented to me are not the choices I want. Would you be any happier if Apple simply decided not to develop the iPhone at all?

Some people just want to find any reason to complain.

Re:There's more here than meets the eye (1)

webmaster404 (1148909) | more than 6 years ago | (#22284858)

First off, I appologize if this seems like flamebait, however there are just so many things that are just plain wrong in this post.

To be absolutely clear--the whole REASON why there's such demand for Apple products is because, unlike many tech companies, they DO care about the entire user experience. It makes using the product simple, easy, convenient. Would people buy Apple products if they WEREN'T easy to use, if that end-to-end experience WASN'T designed? It frustrates me to no end to hear people gripe about "user choice and freedom" but at the same time they covet the simplicity and elegance of Apple's design approach, not realizing that their interfaces and hardware are what they are precisely because it doesn't allow you to customize the crap out of it and ultimately break it in a million ways.


I actually think that the reason that Apple gets such a demand isn't that they are so easy to use necessarily its because they are one of the few tech companies that seems to have innovated and has the money to market them. For example, look back a year or two and see if there were any major phones with a touch-screen interface similar to the iPhone and I bet you there were few, then look at those and see how many had Wi-Fi, a camera, browser and YouTube video viewer (or Flash on the browser) and the number would be tiny, then take those who are easily available in the US and that would chances are be non-existent. Why do you think most people on /. like Apple products? It isn't because they are easy to use, it is because they seem to have innovated more then most other companies and the products they make are easily available.



Taking out choices does not equal easy to use, that is advocating a remote that has one button to make it easier to change channels because you know that a "guide" button just confuses people as is having 2 buttons to change the channel up and down and if you want to change the volume you can buy the iVolume accessory that changes that with one button! If that sounds far-fetched that is exactly what you are saying, that we should make computers more like toys to make them easier to use and take out functionality and then the ideal computer will be a text editor and a browser, nothing more, and no mouse either and while were at it lets take out some keys on the keyboard such as Caps-Lock as those confuse people.

I still don't get though how the iPhone couldn't be unlocked and still be easier to use, unless you say that because a carrier is a choice and those confuse people so we should get rid of all choice!

I am not sitting around with my old crappy UNLOCKED Motorola V3x with an indecipherable interface, whining about how the choices presented to me are not the choices I want.


What you think is indecipherable is to someone else, exactly what they want. For example just look at Unix, to some people the power of Unix/Linux is the reason they like it alone, the customizable interfaces, and choice is why they use a *Nix OS, for some people they panic if they can't see a C: drive on their computer and like not making any decisions content to let some company be it MS or Apple take away all choice and will gladly open up their wallets to them.

Re:There's more here than meets the eye (4, Insightful)

edwardpickman (965122) | more than 6 years ago | (#22284562)

I still vote Flamebait and suggest you reread the parent. Apple has been the target of the mod squad for a lot of years. This whole flame war didn't start with iPhone. Everyone has complained endlessly about Apple computers because there's is little or nothing you can customize and you can't scratch build them. Here's a 411, who cares? There's an ocean of scratch built options so why does it drive the geek crowd so crazy that Apple won't knuckle under and open up? They build solid elegant hardware that runs great out of the box. I just bought two new PC systems, one from Alienware and one from XI Computers. The Alienware took some configuring because of XP not anything Alienware did so it was still a half hour before I was installing software. The XI machine was defective and after a month of screwing around I had to return it and they are building a scratch system. The point is I bought a Mac 18 months ago for an editing system. I took it out of the box, plugged it in and was installing software five minutes after I plugged it in. I've never had a hardware problem and few crashes other than specific software which also crash on my PCs. The iPhone is meant to work the same way. There's a huge number of smart phones out there if you want to tinker or go with another service. The parent did an excellent job of pointing out why they did the AT&T deal. Do I like them? Hell no but it was the ONLY company that would play ball. If Apple wants to expand when their contract is up I'm guessing a lot more carriers will be interested since they have blown expectations out of the water. My only hesitation is there are several features that strangely got left out like movie clips that I was hoping would have been added this spring. The keynote was surprisingly sparce on the iPhone front so I guess not much is going to change until next year so I may wait another year and get my current contract nearer the end before I switch. Just because a product isn't open doesn't make it evil. Apple has always done business this way but it allows them to make superior products rather than the chaos that exists in the PC world. I have endless headaches with ALL my PCs. My Mac just keeps chugging away with probably 5% of the trouble that I have with the best of my PCs. iPhones were built to do what they do and well over a million people seem to like what they do. Sure a lot have unlocked them but this doesn't mean Apple has to do anything. Also if their profits are based on kick backs from AT&T, yes a $500 phone can still be sold at a loss, then they have every right to do updates that cut off unbundled iPhones. We aren't talking digital rights here, if they don't make a profit they go out of business. Would people whine less if they sold iPhones unbundled for $750 with some features crippled?

Re:There's more here than meets the eye (0)

Brian Gordon (987471) | more than 6 years ago | (#22284648)

Do I like them? Hell no but it was the ONLY company that would play ball.
The only company desperate enough to listen to a first-foray phone manufacturer and cede to its outrageous demands just so that it can put the phones out on the market?

it was still a half hour before I was installing software

I have endless headaches with ALL my PCs.
I bet you're the kind of person that gets spyware. The simple matter is that you don't have problems unless you're stupid. Yes, I'm not going to try to be more polite- that's the simple fact. Unless you are stupid, you will have no problems whatsoever. Don't install smiley toolbars, you will not get spyware. I've never known a single Windows user who actually knew what he was doing to have any problems with his machine. Apple does do a very good job at designing computers that are hard for idiots to break (ironic since Windows brought PCs to the masses) but if you don't go swinging a sledgehammer around the OS, you. will. not. have. problems.

Re:There's more here than meets the eye (0)

Anonymous Coward | more than 6 years ago | (#22285056)

The simple matter is that you don't have problems unless you're stupid

I take it you've never had to search for drivers, since XP didn't include them, only to find that the ones you downloaded are buggy? Never had a corrupted registry? Or gone through DLL hell? Never tried dual booting Windows and Linux on a machine that previously ran Linux exclusively?

Re:There's more here than meets the eye (2, Informative)

reidconti (219106) | more than 6 years ago | (#22285072)

I bet you're the kind of person that gets spyware. The simple matter is that you don't have problems unless you're stupid. Yes, I'm not going to try to be more polite- that's the simple fact. Unless you are stupid, you will have no problems whatsoever. Don't install smiley toolbars, you will not get spyware. I've never known a single Windows user who actually knew what he was doing to have any problems with his machine. Apple does do a very good job at designing computers that are hard for idiots to break (ironic since Windows brought PCs to the masses) but if you don't go swinging a sledgehammer around the OS, you. will. not. have. problems.
I think the "stupid" label more accurately applies to a guy who can't appreciate that 98% of the PC-using world has the same gripes and issues with Windows. I've never gotten spyware on a Windows machine either, but that doesn't mean it doesn't ruin the computing experience for everyone; worrying about what kinds of sites you can or can't go to, loading antivirus software and keeping it updated, not using the Outlook preview pane, and so on.

"Stupid" describes a guy who doesn't understand why Apple doesn't just sell OS X for standard x86 PCs.

"Stupid" is a man who attributes all of Apple's sales to trendy hipsters who don't understand the True Power (TM) of Microsoft products.

"Stupid" is someone who thinks he is better than the entire Apple-buying populace but never bothers to try to explain the countless engineers and tech heads who use Apple products because they judge them to be better products.

Also, you might want to reconsider saying that Windows brought computing to the masses. It wouldn't be hard at all to argue that the Macintosh GUI (well before Windows and possibly your date of birth) made computing accessible to the masses. Though if you're just counting by install base, Windows is your champion.

new iPhone features (1)

tgibbs (83782) | more than 6 years ago | (#22284776)

Actually the keynote announcement included the top two features on my wishlist: GPS (OK, not real GPS, but it does the job) and lyrics on the screen while listening to music.

Of course, there will probably be a flood of new features soon, now that Apple is opening the phone up to 3rd party applications.

Who cares? (1)

tgibbs (83782) | more than 6 years ago | (#22284742)

I don't really care much about carrier exclusivity. I pick my carrier based on the phone more than the other way around. The difference between carriers seems minor to me compared to the features of the phone. AT&T might not be my first choice of carrier, but offering iPhone makes them my first choice.

From a business standpoint, exclusive access to the iPhone has value, and enables Apple to get better terms. AT&T's customer base and profits increased significantly based on the iPhone. It wouldn't surprise me if the money Apple is making based on their exclusive relationship with AT&T exceeds what they would have made by offering the iPhone to all carriers. They might sell a few more phones (although I suspect that most buyers are like me, more interested in the phone than the carrier) but they'll be making less money per phone, because a carrier can't be expected to agree to as favorable terms if they aren't going to have an exclusive deal.

Re:There's more here than meets the eye (1)

wootest (694923) | more than 6 years ago | (#22284146)

There are three reasons I see for Apple ever wanting carrier exclusivity in the first place:

* Visual voicemail. New functionality on this order demands special implementation.

* Unlimited data. Regardless of 3G or EDGE, data on *any* cell phone that's not specifically a 3G modem tends towards ridiculous fees. If Apple had released an unlocked iPhone and asked for unlimited data plans, the carriers would laugh and ask if they also wanted a pony.

* To gain a foothold in the total clusterfuck that is the US mobile market.

They're all pretty sad reasons, which doesn't mean they aren't probable. And it just sucks that Apple took their strategy to countries where it's not really needed except to remain consistent with the AT&T agreement.

Re:There's more here than meets the eye (1)

Brian Gordon (987471) | more than 6 years ago | (#22284186)

OK so for the 2nd one.. the carriers would have laughed rightly, since some phone manufacturer is being just ridiculous trying to make demands to the carriers. Why should they listen? Apple can't just demand things or else they refuse to relase their product; how dumb is that?

Re:There's more here than meets the eye (1)

wootest (694923) | more than 6 years ago | (#22284274)

Of course they can't. It is dumb. Your argument is correct.

In this specific instance, I happen to agree that there should be unlimited data plans, and there aren't that many that aren't also focused on "unlimited anything" (flat rate), at ridiculous prices.

Re:There's more here than meets the eye (1)

Brian Gordon (987471) | more than 6 years ago | (#22284334)

Hm? Well on the subject of plans, I can't believe so many people have fallen for that.. the whole business model is that you pay for a certain amount of service every month, and then the company profits when you don't use all of it. They charge ridiculous amounts if you go over to make you so afraid of going over that you leave the company with half your plan in profit at the end of the month. Service should be prepaid, or at least a reasonable flat rate for whatever you do use and a $0 bill in a month that you don't use their network.

Re:There's more here than meets the eye (1)

cbart387 (1192883) | more than 6 years ago | (#22285020)

Service should be prepaid, or at least a reasonable flat rate for whatever you do use and a $0 bill in a month that you don't use their network.
On that subject, if you need a no-frills cellphone plan and talk an average of 300 minutes a month (or less on a cellphone) T-Mobile Prepaid service is the best value I've found. You can buy 1000 minutes for $100 with _no_ hidden costs. That's what annoyed me off about the nextel/sprint plan I had. Officially the plan was 29.99 but realistically it was more like 37 with the stupid fees.

Re:There's more here than meets the eye (5, Insightful)

kithrup (778358) | more than 6 years ago | (#22284336)

No, most of those are the advantages Apple can give their customers with carrier exclusivity.

What Apple gets from carrier exclusivity is the ability to get a portion of the monthly charges from the carrier. Based on reports, Apple gets a significant portion of the customer's monthly payment to AT&T (and O2 in the UK, and T-Mobile in France, and ...); they would not be able to do that without the exclusivity.

Even $10/month from the customer means that Apple would be getting an additional $240 over the course of the 2-year contract; that's a pretty significant reason to continue to push for exclusivity for a while.

Re:There's more here than meets the eye (0)

Anonymous Coward | more than 6 years ago | (#22284328)

This might be one of the best comments I've ever seen on a blog. Lot's of facts and well thought out opinions.

As you point out there were many reasons why Apple decided to partner with AT&T (who by the way is the largest cell phone company in the US).

Apple understands that you can't please everyone all of the time. In general, people just like to complain.

Re:There's more here than meets the eye (2, Informative)

VJ42 (860241) | more than 6 years ago | (#22284360)

Yes, this platform really is that special, no matter how much you, personally, might hate Apple, the iPhone, or both.)
Really? From here in the UK, I still just don't "get" the iPhone. Anecdotally I don't know anyone who has one or is planning on getting one (locked or unlocked) Even the salesman in the Apple store couldn't explain how the damn thing was better than my cheap ass* £30 Nokia, apart from using vague terms like the "iphone experience" whatever that means. In the end I got him to admit that the only thing it had over my phone was the GUI, and that my phone could replicate anything else it did with a bit of help eg:

Check my email: http://www.google.com/mobile/ [google.com] (or just go direct to the gmail site with the phone browser)
Browse the web: http://www.operamini.com/ [operamini.com] (if you don't like the built in browser)
Even visual voicemail can be simulated using MMS [wikipedia.org] (a feature the iPhone lacks).

So if my phone can do that on a pay as you go basis, unlocked and I'm able to switch** if and when I see a better deal Why get an iPhone??? And as I said mine is a cheap phone, so the more expensive Nokias, Motorollas etc. should have even more functionality, right?.
I just don't understand the hype and wish I did, so can someone tell me what's so good about the iPhone?

*cheap as in the second cheapest in the O2 shop despite that it still manages to have a stills and video camera.

**As it happens O2 have been a very good service provider and would happily recommend them to anyone. Ironically they are the company partnered with Apple here in the UK, so brand loyalty wouldn't be a problem should I wish to get an iPhone in future.

Re:There's more here than meets the eye (1)

TheClam (209230) | more than 6 years ago | (#22284470)

You obviously don't know what visual voicemail is. It's not a video of someone talking to you, it's a method of displaying the voicemails in your box graphically without having to sit through each one to see who it's from and how long it is.

I don't even own an iPhone and I know that.

Re:There's more here than meets the eye (1)

VJ42 (860241) | more than 6 years ago | (#22284698)

You obviously don't know what visual voicemail is. It's not a video of someone talking to you, it's a method of displaying the voicemails in your box graphically without having to sit through each one to see who it's from and how long it is.

I don't even own an iPhone and I know that.
I do know that; you can send audio clips via MMS as well as video (yes, I can record just audio clips on my phone), and they sit in your message inbox similar to an SMS so you can open whichever one you want whenever you want. The Apple salesman agreed that this wasn't hugely different to visual voicemail, though he didn't know you could send audio via MMS*. If he was wrong, than someone correct him (and by implication, me) please.

*I possibly got a particularly dumb salesman when I asked straight out "what does the iPhone offer over and above other phones" instead of giving me it's specs. he started going on and on about vagaries like "breakthrough experience" without actually defining what that meant. If somone can tell me what a "breakthrough experience" is I'd be very happy.

College/University requirements for phone sales? (1)

spineboy (22918) | more than 6 years ago | (#22284942)

Correct me if I'm wrong, but generally I don't think that selling cell phones requires a college/university degree. So as a result I usually do my own research about products, than rely on a person of questionable interest, education, and or intelligence. Sure you can get lucky and come across the engineering student who likes the job and knows a hell of a lot more than you, but you can also get the opposite.
Point in case - I was looking at one of the new TX luxury watch line, 770 series (actually made by Timex - cost about $400-500 very neat check them out). Asked the department store salesman about it, and he couldn't tell me crap about it. I even showed him how to work the built in compass several times, and he still couldn't remember which button to press. I've had plenty of salespeople give plain flat out wrong information. Then again, I've also had some that have been spectacular -Porsche salespeople for example :-). He knew every fact I could ask about the car, and most of it's competitors.
So when someone starts talking about the "experience" and can't give you any hard facts, your knowledge hasn't really increased, and it's hard to make any rational conclusion about the item. It may be better or WORSE than what you previously thought about it.

Just to play devils advocate - I'm a surgeon/geek/former scientist, and so how I choose to buy things is probably very, very different than my musician and actor friends. Neither way of buying/comparing things is the "right" way.

Re:There's more here than meets the eye (0)

Anonymous Coward | more than 6 years ago | (#22284806)

Yeah, its more like your voicemails are just another track on your ipod. on screen displays to fast forward through em, skip to the next one, etc etc

its pretty nice, the only real issue is that i end up having 4-5 voicemails that I never listen to. i know who they are from, what they wanted and i just don't ever go back to delete them :P

iTunes shouldn't be involved. (3, Interesting)

Animats (122034) | more than 6 years ago | (#22284364)

"and then the ability to seamlessly activate via iTunes"

"Seamlessly"? You have to have a computer connected to the Internet just to activate your phone? That is so lame. There's a huge population of people, especially outside the US, who have mobile phones but not computers. I wonder what percentage of those un-activated iPhones were bought by people who didn't realize they had to mess with a PC just to turn the phone on.

And you still can't download music over the air link, can you?

Re:iTunes shouldn't be involved. (1)

Brian Gordon (987471) | more than 6 years ago | (#22284420)

Downloading music over the air? Have you even seen itunes? You can't download music more than once even though it's flagged on your account as purchased! I bet there's some executive at Apple that thinks that bandwidth is something you have to pay for by the bit. Contrast that with Steam, where you can download your 10GB of games overnight as often as you want.

Re:iTunes shouldn't be involved. (4, Insightful)

644bd346996 (1012333) | more than 6 years ago | (#22284620)

There's a huge population of people, especially outside the US, who have mobile phones but not computers.
And none of them have any relevance whatsoever. The iPhone costs more than a low-end computer to activate it.

Re:iTunes shouldn't be involved. (0)

Anonymous Coward | more than 6 years ago | (#22285082)

And none of them have any relevance whatsoever. The iPhone costs more than a low-end computer to activate it.

Some people don't want to spend that money on a computer just to be able to use iPhone. I believe this actually describes the majority of cell phone users worldwide if not in the United States.

Re:iTunes shouldn't be involved. (2, Informative)

daveschroeder (516195) | more than 6 years ago | (#22284674)

"Seamlessly"? You have to have a computer connected to the Internet just to activate your phone? That is so lame. There's a huge population of people, especially outside the US, who have mobile phones but not computers. I wonder what percentage of those un-activated iPhones were bought by people who didn't realize they had to mess with a PC just to turn the phone on.

The iPhone requires iTunes for activation and OS updates (which sometimes will bring significant new features, unlike nearly all other handsets), which, in turn, requires a computer, or access to one, period.

And, uh, I don't think people without computers are really the target market for the iPhone. The iPhone is part of Apple's iTunes/iPod/iTunes Store ecosystem.

(And activation via iTunes is a hell of a lot more "seamless" than the crap hassle of most activation processes, in which many people don't always understand exactly what they're getting, either, because the sales rep does this sort of thing all the time (or is clueless), and the customer doesn't. Here, see for yourself. [apple.com] )

And you still can't download music over the air link, can you?

Um, yes, you can [apple.com] .

And the Apple TV, with the new firmware, will also now download things directly from the iTunes Store without a computer being involved.

So while the iPhone isn't really meant to be a standalone item, Apple is indeed moving things in the direction of these sorts of devices being able to work more independent of a computer.

Re:iTunes shouldn't be involved. (1)

HAKdragon (193605) | more than 6 years ago | (#22284794)

You can always take the phone to a local AT&T store/kiosk and have them activate it. And you can download music wirelessly from the "Wi-Fi Music Store" and it will sync with your iTunes library next time the phone is synced. I'm not sure if you need a wi-fi connection to access the store on the phones, but a quick bit of browsing at Apple's iPhone site seems to indicate that you do.

Re:iTunes shouldn't be involved. (1)

tgibbs (83782) | more than 6 years ago | (#22284798)

I wonder what percentage of those un-activated iPhones were bought by people who didn't realize they had to mess with a PC just to turn the phone on.


Rounded off to two significant figures, I'd guess 0.0%. You spend $400 on a product and then keep it when you find out you can't use it; you take it back to the store and get your money back. Even people who don't have a personal computer probably know somebody who has one to activate the phone.

Re:There's more here than meets the eye (1)

gad_zuki! (70830) | more than 6 years ago | (#22284396)

Err, those token features are minor side-effects of an exclusive deal. This was done because Apple and AT&T would make more money this way. This is also why the sidekick never took off in huge numbers. It was the first cheap smartphone with a browser. Too much exclusivity hurts everyone involved except the bottom line. Shame really, I know a few Sprint contract lock-ins who would love to have just bought the thing if they just let you.

Re:There's more here than meets the eye (1)

0xdeadbeef (28836) | more than 6 years ago | (#22284430)

In other worse, We're not going to sell you what you want to buy, we're going to sell you what we want to sell.

Apple joins the ranks of the telecommunications companies, of the music industry, of Microsoft, in employing that thinking.

Rationalize it all you want, but it is obvious there is demand in the market that Apple is refusing to meet. And while the brand-submissives whine about people "copying" the iPhone, others are more than willing to fill that gap.

"it's about more than just buying a commodity...it's getting a pleasant experience along with it, from end-to-end."

Last I checked, the iPhone doesn't give happy endings. I must be using it wrong.

Re:There's more here than meets the eye (1)

bigstrat2003 (1058574) | more than 6 years ago | (#22284548)

Yes, this platform really is that special, no matter how much you, personally, might hate Apple, the iPhone, or both.
No it isn't. Apple fanboys have been proclaiming this since before the iPhone was released, and it wasn't true then, and it hasn't become one iota more true in the meantime. It's just a phone. That's it. It's a well-made phone, I must admit (even though I normally hate Apple design, they did a good job on this one), but nothing more. It is no more than a logical extension of the concepts which were already there, not anything revolutionary.

Re: iPhone and AT&T (2, Informative)

ruffslash (1232488) | more than 6 years ago | (#22284676)

For me, it's simple. I cannot afford the iPhone right now (and not for another 2 years). $400 for the gadget, 2-year commitment to AT&T (not a reputable company; caved in to admin demands to turn over its records to the government), another $600 to abrogate existing service commitment. FOOEY!

Re:There's more here than meets the eye (4, Insightful)

Rob the Bold (788862) | more than 6 years ago | (#22284774)

And remember, contrary to the article's assertion, since owning an iPhone isn't mandatory, and we presumably have free will, no one is "forced" to do anything.

Rather than contrary, isn't that exactly the article's assertion? That no one is "forced" to buy an iPhone, and thus many who might buy it unlocked/unsubsidized don't because it isn't?


From TFA:

The message is that many and probably most iPhone buyers would like to be given a choice of carrier when they buy their iPhone. Some would be prepared to pay more as they do with other smartphones and buy their iPhone unattached to any subsidised carrier contract.

So that represents a lost opportunity cost. Maybe Apple ran those numbers, paid their money and made their choice, deciding the the gain from exclusivity was worth the unlocked instrument sales. If your $200 AT&T subsidy number is right, I supposed that approximates the premium that Apple expects a consumer would pay.


It doesn't matter how many people buy iPhones to unlock them.


Unless AT&T really didn't do their homework before signing the iPhone deal, I would guess that they only pay Apple the subsidy on activated instruments.


And BTW . . .


What about this is so difficult to comprehend?

Your smart-aleckness makes Baby Jesus cry.

Re:There's more here than meets the eye (0)

Anonymous Coward | more than 6 years ago | (#22284952)

There is a vibrant unlocking and hacking community for just about any desirable phone, including ones not available in particular markets, etc.
No need to hack other phones. Most other phones can legitimately be purchased unlocked.

And remember, contrary to the article's assertion, since owning an iPhone isn't mandatory, and we presumably have free will, no one is "forced" to do anything.
Exactly, if you don't like lock in, just don't buying anything Apple.

Re:There's more here than meets the eye (0, Troll)

MogNuts (97512) | more than 6 years ago | (#22285038)

O. My. God. After reading the first half of this post I could go on no more. It makes me want to throw up that your fanboyism is so incredibly strong.

Wow.

Loyalty!? (4, Informative)

fyngyrz (762201) | more than 6 years ago | (#22283956)

...and why should we feel any loyalty to any particular carrier? AT&T doesn't serve my area, so at present, an iPhone isn't an option. This doesn't dispose me favorably towards either AT&T or Apple.

My current carrier doesn't provide many services you can get in other areas, such as video transfer and texting outside the local area. I'm not talking about extra-cost, they simply don't offer it.

On top of all this, cell service is expensive. With these things in mind, I can't imagine how "loyalty" is supposed to even come into the equation. As far as I'm concerned, I'm just looking at which side of the ship to jump off of, knowing that the next ship over isn't likely to be any better anyway.

Re:Loyalty!? (1)

Bodysurf (645983) | more than 6 years ago | (#22284652)

"My current carrier doesn't provide many services you can get in other areas, such as video transfer and texting outside the local area. I'm not talking about extra-cost, they simply don't offer it."

So switch to Verizon -- they have good coverage in 59230.

You need to move to Mali, Kenya or Rwanda (1)

EmbeddedJanitor (597831) | more than 6 years ago | (#22284658)

They get a better deal than you do!

Sorry, but exactly when... (0)

Anonymous Coward | more than 6 years ago | (#22283994)

...has Apple ever given one jot about "consumer choice"? Frankly, they could care less. Their market thrives on supposed "exclusivity".

Re:Sorry, but exactly when... (0)

dgp (11045) | more than 6 years ago | (#22284220)

if they could care less, then they care more than the minimum possible.
that opens the door to them caring care some, and possibly a lot, about consumer choice.
http://www.wsu.edu/~brians/errors/care.html [wsu.edu]

people like choice? (0)

Anonymous Coward | more than 6 years ago | (#22284018)

people hate being forced into hyper expensive contracts with no added benefit to them, news at eleven.

Re:people like choice? (1)

Brian Gordon (987471) | more than 6 years ago | (#22284126)

You mean people shuffling in like sheep because they have the Apple earmuffs crammed so deep into their ears and their sleek silvery designer blindfolds pulled so tight..

my understanding (4, Insightful)

fermion (181285) | more than 6 years ago | (#22284024)

Is that Apple tried to make a phone the old way, i.e. the rokr, and it failed. It failed because carriers want a phone to drive revenue, not serve customers. It failed because Motorola was not able to become an independent entity, but kept the culture as a servant to the carriers.

Apple designed a phone that is very good, and found a carrier that was desperate to play ball and risk a new world order. Apple exclusivity, therefore, serves that new world order. When Apple does not have to cripple a phone in order to insure that the carrier will make enough money. The phone is as Apple wants it for it's customers that are willing to pay for good hardware, not for the carrier customers who largely want believe they are getting a good deal by paying for 'services' throughout a long contract.

And this is where Apple may have blundered, at least in the US. The two year contract. We don't want it, we don't need it. Apple could charge half of what it made with the two year extension, $60, and still likely come out ahead in the long run.

your understanding is wrong (1)

mveloso (325617) | more than 6 years ago | (#22284552)



Every new AT&T activation is a two-year contract. It's not apple's fault. Sorry, please play again.

not an iphone (0, Offtopic)

boisepunk (764513) | more than 6 years ago | (#22284034)

I called AT&T once (don't laugh). Had a problem with my motorola razor. They transfered me to apple. WTF?!

Re:not an iphone (1)

ColdWetDog (752185) | more than 6 years ago | (#22284264)

I called AT&T once (don't laugh). Had a problem with my motorola razor. They transfered me to apple. WTF?!

The call center drone could have transferred you to the Chinese embassy for all he cared. He couldn't answer your question, so he got you out of his hair. In likely record time. Problem Solved. Bet you won't call them for tech support in the near future - a bonus! (from AT&T's point of view anyway).

Sheesh, you'd think you would have figured out this tech support stuff by now. You may return your Geek card at the door.

All phones and all data services (5, Interesting)

xzvf (924443) | more than 6 years ago | (#22284062)

Why can't we have all phones free as in freedom? When I buy a computer I can hook it up to any TCP/IP network and access the internet. Some I pay for and some I don't. When I buy a land line phone, it isn't locked into any phone company. I can plug it into any jack and it works. All I want from my cell provider is a data pipe to get to the internet or the voice network. Period.

Re:All phones and all data services (4, Informative)

Tony Hoyle (11698) | more than 6 years ago | (#22284132)

Try just about any country in the world except the US. The a lot of phones are sold that way (and those that aren't can be released from their network for a nominal fee). You can walk into a shop and buy a SIM on its own (often they're free these days - worth it to the companies to get you on board) and sign up for a plan with no minimum contract or just go pay-as-you-talk.

I still don't get why the iphone is considered so revolutionary, except it's the only one that's permanently locked to a single carrier and has a ludicrously long minimum contract.

Why the iPhone is revolutionary... (3, Insightful)

nweaver (113078) | more than 6 years ago | (#22284302)

The iPhone is revolutionary because it just works.

I've looked at smartphones in the past, and play with them whenever I'm paynig my wireless bill at the store instead of the mail.

Other smartphones don't have web browsers that just works, they don't have email that just works, they don't connect to the computer in a way that just works they don't have a user interface so simple my mom can use it but so powerful I'd love to use it.

I don't have one yet, because I don't NEED a smartphone. But if I wanted a smartphone, rather than just a cellphone, the "It Just Works" factor make it the iPhone or nothing.

Re:Why the iPhone is revolutionary... (2, Informative)

TheRaven64 (641858) | more than 6 years ago | (#22284406)

Other smartphones don't have web browsers that just works, they don't have email that just works
I don't own a phone that really qualifies as a smartphone - it's an early 3G model with a small screen. I do own a 770, and when it's near my phone or near a WiFi point, web browsing (Opera) just works and so does email. I have friends who bought phones a year or so after me and they have web browsers that just work and which are easy to type URLs into with a pop-out keyboard. I've played with an iPhone, and it is nicer, but like OS X on the desktop it has a few UI issues that make it frustrating (although, admittedly, fewer than its competitors). Apple's motto used to be that their stuff 'just works.' Now it that their stuff sucks marginally less than their competitors.

Re:Why the iPhone is revolutionary... (0, Flamebait)

myowntrueself (607117) | more than 6 years ago | (#22284894)

but like OS X on the desktop it has a few UI issues that make it frustrating

I think the phrase you are looking for is "inspired and retarded at the same time."

as I like to say.. (1, Insightful)

QuantumG (50515) | more than 6 years ago | (#22284432)

Apple products Just Work except for when they Just Don't and then you are Just Fucked.

You won't find anywhere on your iPhone to configure the applications because you shouldn't need to.. but if you do, call tech support cause there aint no way to fix it self and the same goes for everything else made by Apple. It's proprietary technology and that's nothing but a disgrace in this day and age.

Re:Why the iPhone is revolutionary... (2, Insightful)

gad_zuki! (70830) | more than 6 years ago | (#22284444)

The iPhone is revolutionary because it just works.

My dads old POS cadillac just "worked." It started every time. No one would call that car revolutionary.

My treo "just works." I can make phone calls and surf the web.

I'm not sure why people keep using this tired old canard, but lots of things "just work."

Re:Why the iPhone is revolutionary... (1, Insightful)

Anonymous Coward | more than 6 years ago | (#22284564)

Yeah, it's a pretty sad state of affairs in this day and age whenever a product does exactly what its designed to do is considered a "feature" complete with the execrable market-phrase "It Just Works".

Re:All phones and all data services (0)

Anonymous Coward | more than 6 years ago | (#22284380)

I'm not sure if you're in the USA, but the major cell phone vendors are all attempting to lock people into two year contracts. All of the good phone deals are two year contracts. While I do not favor that concept, it makes some logical sense. Selling you the phone at a loss in return for your two year subscription seems reasonable to me. I do not understand how a company can afford to give phones away otherwise.

And while the Iphone has a hate club that says that it brings nothing new to the table, it absolutely, positively does. Sure, Apple has severely restricted it in some ways and has avoided providing some capabilities that other phones provide at the same price or less. But no other phone has as slick a web browsing interface or as intuitive of a user interface.

Apple wants continued revenue from AT&T and AT&T wants your subscription. If you want the Iphone, sell your soul away. If you don't, why continue whining about it? There are other companies that offer other plans and other phones. Pick one.

Re:All phones and all data services (1)

dgp (11045) | more than 6 years ago | (#22284248)

you can. they're called unlocked GSM phones.
I use a phone i got off ebay on the tmobile network.
works great.

i too wonder why phones are not sold outside of carrier
agreements in general. the FIC FreeRunner phone will
be sold that way, and it runs on open source software.

Re:All phones and all data services (1)

doktor-hladnjak (650513) | more than 6 years ago | (#22284320)

The reason they're not sold outside of agreements is because the carriers refuse to charge phone and service costs separately. If you buy your own phone, you pay exactly the same monthly fee as somebody who got a "free" phone. So long as that's the case, it makes sense for customers to get the "free" phone and be locked into a 1 or 2 year contract.

Another "analysis" missing the point (3, Informative)

schnell (163007) | more than 6 years ago | (#22284084)

Apple is trying to upset the traditional business model for handset makers in that they wish to get a cut of recurring subscriber revenues, not just a one-time equipment sale. Apple is able to get this revenue (which in the long term means more than the phone sale!) precisely because it has granted exclusivity to a single carrier. If AT&T was no longer guaranteed to capture the vast majority of iPhone subscribers, it would neither have (a) implemented the needed Voicemail and EGDE network upgrades and the billing system+iTunes interface, or (b) agreed to give a cut of subscriber MRC to Apple.

The simple calculus here is that carriers will do special things that Apple asks for (changing the way they bill and provision customers, plus handing over a cut of service revenue) in return for Apple doing something the carriers ask for (exclusivity). I don't think anyone would sensibly argue that carrier exclusivity is in the best interest of all customers, but that doesn't mean you're really tied to it. Those with the means and technical knowledge will continue to purchase and unlock phones to their hearts' content - that's the beauty of a GSM ecosystem (well at least for 2 of the 4 main US carriers). Apple and all the carriers internationally that it deals with - plus all the cellphone users who just want all of their cool Apple features to work with a minimum of hassle - will continue to pursue the exclusivity model for the foreseeable future.

Re:Another "analysis" missing the point (2, Insightful)

kevinbr (689680) | more than 6 years ago | (#22284554)

Any Mobile operator would have implemented visual voicemail without an exclusive deal, I would doubt that the integration level was that difficult. Apple might have to have fronted the cost.

Regarding EDGE Apple could have targeted EDGE enabled telcos. The provisioning in France was a joke - I spent 45 minutes in an Orange Shop, and still cannot change levels of iPhone plans online. Orange still has the normal provisioning system in place. So it seems Jobs only cares about the full experience for American customers. The service revenue of course would not happen, but sadly if he wants to destroy the traditional mobile world getting into bed with dinosaurs like Orange is not the way to go.

Regarding billing systems, I doubt there is much integration.

Mobile operators do all kinds of expensive integration ALL the time often with dubious rates of return. ( I have worked for all major European telcos )

Steve's insistence on not having subsidies is dumb (3, Interesting)

antifoidulus (807088) | more than 6 years ago | (#22284100)

Steve Jobs wanted to change the way cell phones are bought but ended up just making so many annoying restrictions, even for customers that want to use AT&T/T-mobile/Orange that he ended up destroying the "simple" experience he so desired. He wanted people to be able to buy the phones directly from Apple without having to sign anything in store and/or online. However, when people started to unlock the phones Apple put in place tons of walls even for buyers that plan to use Apple's carrier. For example, you cannot buy iPhones with cash or Apple gift cards(in the states anyway). They announced this right before Christmas and many potential iPhone buyers already let it be known that they wanted Apple gift cards for Christmas so they could buy the iPhone. Instead, Apple just kicked them in the teeth.

What I don't understand is why, when Apple dropped the price, they didn't just make the price drop a subsidy for AT&T customers instead. They could have offered $200 off AT&T service after the first month that wasn't applicible to cancellation fees, and could have extended it to early adopters so they wouldn't have felt burned. Would have allowed Apple to drop the price to AT&T users(well, it would take a few months to see all the savings I suppose), and would have given Apple 50% more revenue from unlockers. But I think Steve was just so set against "subsidies" that he decided to take the "I'll do anything to prevent you from getting an unlocked iPhone" route instead. I think that costed Apple not only customers and revenue, but a LOT of goodwill too.....

Exclusivity is the point (2, Insightful)

da_matta (854422) | more than 6 years ago | (#22284112)

The whole point of the iPhone business model for Apple is to offer it exclusively so they can get part of the revenue. The idea is that iPhone as single product is so desirable that it will get people to switch from competitors (which is very expensive to achieve by traditional campaigns). And the real revolution of Iphone is that Apple managed to get this from the carriers. If there's no exclusivity, there's no revenue sharing.

This idea of Apple being "forced to exclusivity" is ludicrous; they've worked very hard to achieve the exact opposite!

No choice... (1)

owlnation (858981) | more than 6 years ago | (#22284138)

In a free market it is only right that there is a choice of carrier.

However, the mobile phone industry is one where to all intents and purposes the choices are "rock" and "hard place". Which makes me wonder if it really matters in this case.

Phone companies are not your friends. They are not out to give you a good, nor fair, deal. Not one of them. Every transaction with them is one of compromise. Regardless of whatever your contract says you'll be paying the same amount of money either way, with any provider. The contract serves only to confuse and confound you into believe you are getting what you are looking for.

I'm really not convinced it makes any difference whatsoever which one you sign up with. You will be screwed one way or the other.

Re:No choice... (3, Informative)

owlnation (858981) | more than 6 years ago | (#22284176)

I think it's why they're called cell phones. Cell as in "imprisoned".

Re:No choice... (0, Flamebait)

Anonymous Coward | more than 6 years ago | (#22284704)

methinks you got that backwards, a prison cell isn't named a cell because it's imprisoning, but because a prison is made up of a cluster of these cages that take on a cellular configuration, much like the cells in your body don't imprison their contents but form functioning cellular clusters with eachother... trying to rework logic only shows you are a) an idiot or b) can't form an argument.

Re:No choice... (1)

Lally Singh (3427) | more than 6 years ago | (#22284488)

I don't disagree. But I'd like to point out that what makes a company give customers fair deals is a level of trust between customer and vendor.

Some vendors give you good deals, give you good service, and a fair price for them. Unfortunately, lots of customers consider a fair price only to be equal to the lowest price in the market, ignoring the long-term cost of the rates (e.g. lower up-front costs in exchange for higher monthly fees), quality of service provided, etc. Those vendors that give customers the low price that they want end up having to play games in order to stay afloat. E.g. low prices up front, but unexpectedly high additional costs over the lifetime of the product. Inkjets vs lasers come to mind.

Customers rarely do two things at the same time:
1. Look at how much they get, overall, for what they pay
2. Consider how much that has to cost the vendor to provide.

Vendors have a choice of being accused of ripping off their customers (e.g. say a macbook compared to a $400 dell) or drop the quality of their product & play pricing games to make ends meet.

As for apple, while they have a sweet deal with AT&T, they don't benefit from the exclusivity. It's better to have a larger pool of potential customers (e.g. from multiple carriers) than a smaller one. My guess is that they were fine with AT&T-only for the short term so they'd only have to build a GSM phone.

For the record, I think the iPhone is a wonderful device. I got one for my mom and it's been a godsend to her (techies often underestimate the value of good telephony, or that of a good mobile web browser). I was planning on getting one, but I've decided on an openmoko instead -- the urge to hack low-level is too strong in me these days.

Re:No choice... (-1, Troll)

Anonymous Coward | more than 6 years ago | (#22284734)

For the record: you are an idiot.

Your summary of market forces and economics is utterly pathetic. Have fun with your openmoko, but one suspects you no techie in a real sense of the word, and your wishful thinking about doing low-level programming on the openmoko is yet more wishful thinking. Is your ability at coding as flaky as your understanding of economics?? Don't be a self-proclaimed whizz-kid all your life.

free market (1)

Bored MPA (1202335) | more than 6 years ago | (#22284532)

You misunderstand what a free market is, a free market is an unregulated market where businesses and consumers are free to do whatever they want to sell/buy products. This includes vendor lock-in, package deal requirements, purchasing groups, etc. It also includes no gov't mandated IP. /ramble
What you are actually implying is that you want a specific market regulation--choice of carrier for your phone. I think that IS reasonable (it's amusing too, because we used to have to rent phones from AT&T back before AT&T was broken up...oh wait...). And considering yesterday's politics article this should probably be tagged Ron Paul, because he and those like him are _against_ all market regulation protecting consumers from vendor lock-in and lock down of features--whether phone features or digital rights restrictions or filtering internet communications or net neutrality. Ron Paul's ideological stance is that regulation itself is bad and the private sector is good, and thus doesn't even match an economist's understanding of the strengths and weaknesses of "free markets."

My basic premise would be that since each of us are individuals with limited resources, we need regulation to reduce swindling (especially in financial services and insurance areas), reduce monopolistic control by large corporations (improve consumer product choices), and require standards of safety across the market (businesses cannot always agree on their own or defend against unsafe imports).

As it is, most of our services cost more and have fewer features than other 1st world countries because we are either too lazy to choose, have too little choices, or are too weak to regulate. I.e. Japan doesn't have vendor lock-in/lock-down of cell phone features. The only thing we're marginally good at is standardized safety requirements, but that gets foreign pressure(i.e., japan banned our beef imports because we dont do enough testing for mad cow). /endoframble

Stop Complaining - Steve Says It's OK (1)

BSDetector (1056962) | more than 6 years ago | (#22284174)

Stop Complaining - Steve Says It's OK!!!

So Apple is supposed to violate its contract? (2, Informative)

DECS (891519) | more than 6 years ago | (#22284244)

Can Apple afford to stick to an exclusive carrier in the future? If for no other reason than consumer choice?"

Can Apple leave its five year exclusive contract with AT&T? If for no other reason that to heed the cautionary woes of a Computerworld writer with tenuous grasp of business and markets?

The problem with wags is that they talk about Apple, Microsoft, AT&T, etc as if they were characters in a play they were writing, apparently unaware of the real world constrains of money, technology, personnel, opportunity cost, and other resources. They write like they're genus for printing ignorant wishful thinking that sounds good only if you don't know what else is involved.

Video Game Consoles 2007: Wii, PS3 and the Death of Microsoft's Xbox 360 [roughlydrafted.com]

Re:So Apple is supposed to violate its contract? (1)

Midnight Thunder (17205) | more than 6 years ago | (#22284668)

Can Apple leave its five year exclusive contract with AT&T? If for no other reason that to heed the cautionary woes of a Computerworld writer with tenuous grasp of business and markets?

Probably, but at what cost? This will depend on the terms of the contract. I am just curious whether AT&T needs Apple more or whether Apple needs AT&T more. This is an important point, because this will define who owes what if the contract is broken, and who is most likely to opt for pulling out of the contract first.

Re:So Apple is supposed to violate its contract? (1)

DECS (891519) | more than 6 years ago | (#22284854)

The best agreements involve partners who both need each other. Apple needs exclusive partners with the iPhone to push its unique features, gain lower service fee terms, and promote the iPhone. Apple wants providers to benefit from exclusive availability of the iPhone. AT&T had little opportunity to gain on Verizon until it had a unique phone that nobody else could get. I'd imagine that in addition to the 40% defection to AT&T that new iPhone users caused directly, that there was also a large number of people attracted by the iPhone who bought other AT&T phones on family plans or similar "halo" effects. Clearly AT&T is happy.

In Europe, the market is different. O2 didn't provide as good of pricing, but apparently thought the iPhone was helping to bring in new customers (or had the potential to do so) enough to boost its plans dramatically after the initial launch. TFA says Apple would be better off trying to sell its phone without carrier limitations. I'd imagine that Apple exercised some due diligence in examining that course of action long ago and decided against it.

If Apple can keep its current 4 carriers happy, it will have a much easier time expanding its exclusive agreeements to other carriers in other regions. If it starts experimenting with cheating on its current exclusive carriers by allowing or facilitating unlockable iPhones, why would other carriers concede anything to get the iPhone? Apple would end up like Motorola: carriers would all demand the iPhone get cheaper while increasing their service fees. Apple has a big bargaining chip with the iPhone, and is using it to pry open the mobile market.

Saying Apple needs to cater to unlocking customers is a bit like saying The Unions should allow their members to pay dues only if they want to. Sounds good to a moron, but it doesn't really work that way unfortunately. If you want the bubble of protection, you have to pay something for it. If you don't, you live outside the bubble. It looks like most iPhone customers are happy with the bubble. The ~25% that are unlocking appear to be scattered around the world (web stats show iPhones in nearly every country) where there is no bubble.

Apple is selling a desirable product at an upfront price with clearly stated limitations in an industry that prefers to sell inferior phone sets at fake subsidized prices with all kinds of unstated limitations. I think consumers are smart enough to figure out if the iPhone works for them or not without Apple being forced to play the same carrier-centric game that all the other phone manufactures have been failing in.

Is the MacBook Air Another Cube?" [roughlydrafted.com]

Loyality (1)

Slorv (841945) | more than 6 years ago | (#22284312)

"The point is many consumers feel no loyalty to carriers and resent being forced to choose one."

I would phrase it differently.
I am loyal to my carrier, that's why I prefer not to change just because I buy a new phone.

Why I would need to switch to a new carrier just because I want use a certain phone make little or no sense to me.

Also, my employer pays my mobil phone bills but only as long as I use SIM-card they provide. The SIM-card is tied to a certain carrier using a company deal. So selecting what company should provide phone services isn't always something done by the individual.

This menas no iPhones at work as for now. Sad...

How? (1)

His Shadow (689816) | more than 6 years ago | (#22284388)

How does a speculative article on what Apple may or may not do and what their relationship with AT&T may or not be in the future turn in to the hit whore headline "Apple Can't Afford iPhone's Carrier Exclusivity"?

As a consumer (1)

Z00L00K (682162) | more than 6 years ago | (#22284400)

My loyalty is at the carrier that provides the most reliable services, not necessarily the cheapest.

This said - I'm still not willing to pay an outrageous sum of money to get good service, but a sensible. If a certain phone has what it takes to satisfy my needs/requirements then I select that phone and uses it with the carrier of my choice. But if the phone is locked to an operator I'm not willing to switch carrier just because I want that phone. In that case it's either an unlocked version or skipping that phone and selecting one with equal capabilities that can be used instead.

One thing that I really try to avoid is the operator-lobotomized versions of the phones (branded phones) since that means that I almost certainly will get some kind of problem with them when using them with a different operator.

Contradictory conclusions (2, Interesting)

crmarvin42 (652893) | more than 6 years ago | (#22284414)

The point is many consumers feel no loyalty to carriers and resent being forced to choose one
I hate to be pedantic, but isn't this statement fundamentally contradictory? If they have no carrier loyalty, then why should it be a problem to switch networks if they really want to use an iPhone? If the desire to use an iPhone is greater than the desire to stick with your network then it could be argued that you lack (sufficient great) carrier loyalty. If the desire to stay with your current carrier is greater than the desire to use the iPhone then it could be argued that you have loyalty to your current carrier. I fail to see how not liking your carrier would make you less likely to switch to AT&T so that you can (legally) use an iPhone.

I've read a lot of articles, and at least seen mention of a lot more, that spout off about how Apple screwed up it's iPhone licensing deal by tying themselves to a single carrier. However, a lot of the time within the same article, or another article on the same site will often rave about how it is an example of one of the greatest product launches of all time. If Apple screwed up so bad, how did they do so well? It all strikes me as fanboy baiting. Write an article praising Apple, their products, or their tactics to bring in the apple hater, then write one denigrating Apple, their products, or their tactics (often implying that Apple is the new Microsoft) to bring in the Apple fanboy's (of which I'm arguably one). Each article is carefully crafted to miss obvious points and make glaring mistakes so as to ensure that it's attacked in the message boards driving up the hit counters and making more ad revenue than any other article that day.

What's the problem? (2, Insightful)

webword (82711) | more than 6 years ago | (#22284428)

No one *needs* the iPhone. It is simply something that people desire.

But that's besides the point.

The article is about going global. No one is saying that Apple really plans to go exclusive around the world for the long term. They'll sign some agreements to get traction with the big carriers, and when 3G arrives, they'll adjust. They'll probably go for less than 5 years exclusive.

Technology changes so fast that this is really a moot point. I'm not even sure why people are getting excited or worried.

Hey - Verizon will switch you for free! (0)

Overzeetop (214511) | more than 6 years ago | (#22284626)

Just take your iPhone in and Verizon will set you up with an account on their system. Costs per month will be about the same, give or take $30, unless you dont' get unlimited wireless (but you would anyway, right?).

Oh. What's that? You can't use even an unlocked phone on Verizon? Really? Their system isn't the de facto world standard for cell phones? So you'd have to design a special radio version for Verizon, and then a different one for the rest of the world? Hmmm...that's stupid. Oh well - I'm sure they'll be happy to send you a bill every month anyway, even if you can't use te network. As long as your check cashes, it's all good.

Re:Hey - Verizon will switch you for free! (0)

Anonymous Coward | more than 6 years ago | (#22285028)

Verizon is moving to GSM as part of their open access policy announced last year. They already offer hybrids that use CDMA for voice and GSM for data.

Apple can afford it (1)

hyperz69 (1226464) | more than 6 years ago | (#22284746)

with 14 billion on hand *note that Microsoft HAD 19 billion on hand* The real question is... can their Market Cap afford it?

I'd like a choice of technology that doesn't suck (1)

jhylkema (545853) | more than 6 years ago | (#22285050)

GSM data is a joke. I'll take my CDMA any day of the week.
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