New around here so sorry if it has been covered before. I've nearly gone boogle eyed reading all the stuff on the hacking / bricking / legal / rights/ etc etc over the iPhone. Most is enjoyable and informative and the clientel seems to be fairly erudite and good natured. Of course there also seems to be the usual mix of Apple plants, fanboy ravers, bar-room lawyers and Steve Jobs is the Messiah / Satan of the electronics world and there seems to be an awful lot of the same old drivel repeated in every thread. But go to any forum, be it cars, watches, cigars, whatever and you will find the same mix and emotion when something "big" happens
Sorry I digress. One of the arguments for Apple locking the system is loss of cash both for them and AT&T so I tried to come up with some numbers.
First off. Apple. Lets assume 1 million iPhones have been sold at an average price of 400 bucks a pop. Apple pocket 400 million greenies. Man, that is a lot of cash in just about 3 months.
They are supposed to be pulling in approx 10 dollars from AT&T every month for the contract exclusivity. That's another 240 million dollars over the 2 year life span.
Call it around 650 million dollars over 2 years for selling 1 million iPhones in 3 months. Lets also assume that each iPhone costs about 200 dollars to make (most likely less but lets stick with 200). We are still looking at revenue before taxes and marketing, R&D investment etc on the iPhone at over 400 million smackaroonies. I'm ignoring salaries etc as many of the people involved in it won't be purely dedicated to the iPhone line.
Lets say everyone just uses the standard AT&T $60 a month plan on activation. That means over the 2 year life AT&T will rake in $1,440 million for the 1 million iPhones sold. They give Apple 240 million so it leaves around 1,200 million in revenue. Of course there may be other income such as a one off activation cost etc. Don't know as I never activated mine so I'll ignore them.
Now the squiffy bit. How many of those iPhones were unlocked and don't run on AT&T? In a sense Apple couldn't care because they still get paid for the hardware but will lose the recurring AT&T charges. I have no idea what a good figure would be but say 10 thousand. How do I come up with that figure? Well hanging out in the various forums I can see that many threads on the iphone actually generate thousands of views but since the 1.1.1 update how many post have we seen about bricked phones? Not that many. What phones will get bricked? Those that were unlocked. Who are the people who unlocked their phones and had the problems? Guys who hang out on the forums. Not Joe Man in the Street. His phone is fine because he doesn't give a toss about unlocking or apps or whatever. He wants to impress his friends or whatever with his sexy phone.
So lets say I'm right and 10,000 iPhones escaped the AT&T net (actually some unlocked ones won't as people will still use AT&T as a carrier but just sim swap when abroad) but lets call it 10,000.
AT&T will lose around 15 million bucks over the 2 years from those stragglers. Of that Apple should have gotten almost 2.5 million.
Big money to you and me but a drop in the bucket when compared to 1,200 million and 650 Million. Obviously if the number of unlocked phones is more than 10,000 then those numbers will be more but subsequently if less then the "loss" will be less as well.
For Apple to regenerate that 2.5 million all they had to do was sell another 6,000 iPhones.
Anyway, I hope my math holds up.
Pete
Sorry I digress. One of the arguments for Apple locking the system is loss of cash both for them and AT&T so I tried to come up with some numbers.
First off. Apple. Lets assume 1 million iPhones have been sold at an average price of 400 bucks a pop. Apple pocket 400 million greenies. Man, that is a lot of cash in just about 3 months.
They are supposed to be pulling in approx 10 dollars from AT&T every month for the contract exclusivity. That's another 240 million dollars over the 2 year life span.
Call it around 650 million dollars over 2 years for selling 1 million iPhones in 3 months. Lets also assume that each iPhone costs about 200 dollars to make (most likely less but lets stick with 200). We are still looking at revenue before taxes and marketing, R&D investment etc on the iPhone at over 400 million smackaroonies. I'm ignoring salaries etc as many of the people involved in it won't be purely dedicated to the iPhone line.
Lets say everyone just uses the standard AT&T $60 a month plan on activation. That means over the 2 year life AT&T will rake in $1,440 million for the 1 million iPhones sold. They give Apple 240 million so it leaves around 1,200 million in revenue. Of course there may be other income such as a one off activation cost etc. Don't know as I never activated mine so I'll ignore them.
Now the squiffy bit. How many of those iPhones were unlocked and don't run on AT&T? In a sense Apple couldn't care because they still get paid for the hardware but will lose the recurring AT&T charges. I have no idea what a good figure would be but say 10 thousand. How do I come up with that figure? Well hanging out in the various forums I can see that many threads on the iphone actually generate thousands of views but since the 1.1.1 update how many post have we seen about bricked phones? Not that many. What phones will get bricked? Those that were unlocked. Who are the people who unlocked their phones and had the problems? Guys who hang out on the forums. Not Joe Man in the Street. His phone is fine because he doesn't give a toss about unlocking or apps or whatever. He wants to impress his friends or whatever with his sexy phone.
So lets say I'm right and 10,000 iPhones escaped the AT&T net (actually some unlocked ones won't as people will still use AT&T as a carrier but just sim swap when abroad) but lets call it 10,000.
AT&T will lose around 15 million bucks over the 2 years from those stragglers. Of that Apple should have gotten almost 2.5 million.
Big money to you and me but a drop in the bucket when compared to 1,200 million and 650 Million. Obviously if the number of unlocked phones is more than 10,000 then those numbers will be more but subsequently if less then the "loss" will be less as well.
For Apple to regenerate that 2.5 million all they had to do was sell another 6,000 iPhones.
Anyway, I hope my math holds up.
Pete
