Apple with "No Plans" to Change AT&T iPhone Exclusivity and Other Notes

[MacRumors]

Apple's Tim Cook and Peter Oppenheimer provided some insights behind Apple's iPhone strategy today during the Q2 financial results conference call.

When specifically asked about Apple's long term exclusivity with AT&T, Apple responded that they are very happy with AT&T and feel they have done a very good job promoting the iPhone. Despite some recent hope that Apple might expand the iPhone to other networks, Apple said that they have no plans to change the AT&T exclusivity at this time. Also mentioned was the fact that Verizon currently uses the CDMA network which is incompatible with the current iPhone. Apple stated they wanted the iPhone to be a global hardware device which requires the use of the GSM standard. This may confirm claims by Verizon's CEO that Apple may have never intended to launch a CDMA (Verizon) iPhone. This situation may change when Verizon upgrades their networks.

Another interesting statistic revealed was the total number of iPhones and iPod Touches has now reached 37 million units. Apple had sold 30 million as of December 2008.

Finally, Apple reiterated that they no plans to leave a "price umbrella" for competitors to sneak in. What this ultimately means remains unclear, though some had originally felt this could mean Apple will introduce lower priced models ("nano"). Apple also reiterated the importance of the App Store and their software-focused approach to the iPhone platform.

Article Link: Apple with "No Plans" to Change AT&T iPhone Exclusivity and Other Notes

[Pugpuppydude]

Wow, back during the release of the iPod touch, i would have never thought it would become such a popular and successful product. It certainly has became one of the most popular devices out there...

So much for ever getting the iPhone on my Verizon contract...

[clownjuggles]

They need to start offering unlocked phones then.

[SkippyThorson]

Not leaving a price umbrella sounds a lot different than "we're not working on a Netbook", but that could just be me.

I want my Touch tablet. I've been waiting for years. Literally. I'm excited for WWDC - ah, have they still got it.

[NT1440]

I think , for Apple at least, this is a GREAT strategy. Keep selling the big numbers exclusively on AT&T. Then what happens when LTE becomes the standard all around? BAM! A full release (along with a revised iphone) just opening the floodgates for a boom of which we haven't seen the likes of.

Its a good longer term strategy business wise, especially since AT&T is obviously having to do some serious "negotiating" (read: ass kissing) in order to remain exclusive just for another year.

[zdobson]

Of course they're not going to say that they're going to make the phone available on other networks (even if they are) b/c it would hurt sales now.

[dantherevelator]

Originally Posted by MacRumors

[...] they no plans to leave a "price umbrella" for competitors to sneak in. [...]

The initial price is not an issue, the problem is AT&T's ridiculous fee structure.

[ajones46]

can someone help explain this price umbrella...? I feel extremely smart right now.. lol

[bruinsrme]

Originally Posted by dantherevelator

The initial price is not an issue, the problem is AT&T's ridiculous fee structure.

Can agree more.
My Verizon bill for 3 phones never broke $100.
My Att bill is sneaking up on $150 for less minutes.

[NT1440]

Originally Posted by bruinsrme

Can agree more.
My Verizon bill for 3 phones never broke $100.
My Att bill is sneaking up on $150 for less minutes.

Are any of those verizon phones smartphones with a data plan? (honest question).

[Grimace]

The conference calls are always very tight-lipped about the future. "No plans to partner with anyone besides AT&T right now" legally translates to, "it could happen next week, but we can't tell you that right this second."

AT&T will have to beef up profit-sharing to keep exclusivity, and Apple wants a larger share overall of the market, not just money.

Verizon's new carrier technology (+ Tmobile) by WWDC 2010!

[Surklyn]

Originally Posted by Donz0r

Second is the best!
No plans, that'll disappoint a lot of people.

I'm happy with ATT though. Verizon uses old technology. GSM is the way to go

I agree completely. When I first bought my iPhone, the coverage from AT&T honestly blew, however, in 2 years they've DRAMATICALLY improved their coverage in my area (and in areas in the mountains where I didn't get coverage even from Verizon), and I now have 3G in my area, which I didn't when I first bought the phone. This shows me the company is serious about improving their service. Thus I am not about to abandon a company which has shown me improved service year by year.

[Surklyn]

Originally Posted by NT1440

Are any of those verizon phones smartphones with a data plan? (honest question).

No they are not.

[NT1440]

Originally Posted by Surklyn

I agree completely. When I first bought my iPhone, the coverage from AT&T honestly blew, however, in 2 years they've DRAMATICALLY improved their coverage in my area (and in areas in the mountains where I didn't get coverage even from Verizon), and I now have 3G in my area, which I didn't when I first bought the phone. This shows me the company is serious about improving their service. Thus I am not about to abandon a company which has shown me improved service year by year.

I'm almost 100% sure that Apple had a big part in forcing AT&T to do better. I would not like to have been in meetings with AT&T heads and Steve, im sure there would have been a TON of yelling from one side in particular.

Something along the lines of "step the f#$k up or we are taking our ball home"

Originally Posted by Surklyn

No they are not.

Then its not a fair comparison. The average data plan (required when using a smartphone) across the industry (in the US) right now is right around $30 a month.

[Primejimbo]

Originally Posted by Surklyn

No they are not.

There you go, I was going to get a smart phone when I had Verizon and it was the same price as the iPhone. So you have to compaire apples to apples (on pun). I find Verizon and at&t pricing to be the same.

Originally Posted by NT1440

Then its not a fair comparison. The average data plan (required when using a smartphone) across the industry (in the US) right now is right around $30 a month.

I agree, the 2 companies are the same in prices

[scamander24]

I don't like AT&T's iPhone plan because they'd charge me more for going to Canada, because AT&T's got a deal with Rogers, Canada's largest network.
(translation: they rip u off for going to Canada)

Verizon doesn't have any sort of deal, and so they don't charge as much as AT&T.

[mentalward]

I'm a little dissappointed (but not surprised) to hear the iPhone is seemingly staying with AT&T, if only because they don't have native network coverage here in MT. My only real choice to get an iPhone would be to buy a jailbroken one to use on CellularOne's network. Maybe those rumors of AT&T buying and converting Alltel's divested network here will come true...

It comes with the territory, at any rate; I'd pick Glacier Park over the iPhone any day

[electronboy]

A cheaper phone still doesn't help lessen the pain associated with operating costs approaching or in excess of $2,400 over the term of a two year contract.

A $49 64GB iPhone is useless to me unless AT&T begins to offer a selection of limited data plans or includes unlimited SMS with an 'unlimited' data plan.

[Ntombi]

Originally Posted by NT1440

Then its not a fair comparison. The average data plan (required when using a smartphone) across the industry (in the US) right now is right around $30 a month.

Yep. I moved from a smartphone plan on Verizon to an iPhone plan with AT&T, and it's basically the same.

[Frisco]

This contract has been way more beneficial to AT&T than to Apple.

[Surklyn]

Originally Posted by NT1440

I'm almost 100% sure that Apple had a big part in forcing AT&T to do better. I would not like to have been in meetings with AT&T heads and Steve, im sure there would have been a TON of yelling from one side in particular.

Something along the lines of "step the f#$k up or we are taking our ball home"

Well... regardless, whether it was Apple or AT&T, the company has improved their coverage/performance since the iPhone... whether or not AT&T can sustain this "growth" is debatable.

[davidbrummy]

Originally Posted by Frisco

This contract has been way more beneficial to AT&T than to Apple.

Totally agreed. I ported in as I know a lot of people did to get an iPhone. I think AT&T would be in a lot of trouble without it.

All these recent announcements do make me wonder if Apple did really offer Verizon the iPhone and were turned down or wether they just had an initial discussion with them. The way they make it sounds these days is GSM was really the only way to go for a Global device.

[inkswamp]

Originally Posted by dantherevelator

The initial price is not an issue, the problem is AT&T's ridiculous fee structure.

Maybe not for you or me but Apple hasn't conquered this market quite yet and they're in a market where people typically expect the phone to be a freebie, so Apple needs to push the price of the phone lower if they want some serious traction.

I think they will follow the iPod strategy and eventually introduce lower cost units with lower cost voice/data plans to match. Of course, you can't take much away from the iPhone as it now stands, but you can introduce higher end models with more storage and maybe some high-end exclusive features.

I've said it before but it bears repeating. The "iPhone Nano" already exists. Everyone who has an iPhone right now, has the future low-end iPhone. It would be surprising if Apple didn't take today's iPhone and push it down into a low cost slot while introducing newer models. A similar strategy worked wonders for the iPod.

[DELLsFan]

Originally Posted by NT1440

I think , for Apple at least, this is a GREAT strategy. Keep selling the big numbers exclusively on AT&T. Then what happens when LTE becomes the standard all around? BAM! A full release (along with a revised iphone) just opening the floodgates for a boom of which we haven't seen the likes of...

It sure would be nice to see the iPhone revised with a dual band GSM / CDMA logic board or chip. I loath the premise of exclusivity contracts in general, however. I think without them, competition would breed more robust and innovative networks and smart phone selections across the board - not just for the iPhone.

[libertyforall]

So where does that leave Sprint-Nextel? With TDMA/CDMA/EV-DO networks and Wi-Max on the ramp-up -- it seems there is no iPhone possibility here, since these are not used outside the US much.

Verizon is moving to LTE, so that's a possibility...

It also seems that Wi-Max has some momentum behind it, time will tell...