iPhone Atlas claims wireless companies pay an up-front subsidy to Apple

[SFStateStudent]

Have you seen this article?:

First-generation iPhones still fetching high prices
Posted 16 June 2008 @ 11am in News

Despite the imminent release of the iPhone 3G, first-generation iPhone models are still commanding high prices on eBay and other resale venues, indicating concern over the ability to unlock and/or jailbreak the upcoming model combined with significant demand in countries where the iPhone 3G will not initially be on sale, including Russia and China. A cursory scan of eBay reveals several listings of unlocked, 16GB, first-generation iPhones with bids in excess of $600. The phone retailed for $499 before it was discontinued. The iPhone unlock market has proven lucrative for grey-market entrepreneurs who bought dozens of iPhones to resell as carrier-agnostic in international markets. With the iPhone 3G, however, Apple has transitioned its partnership model to a more traditional format: wireless companies pay an up-front subsidy to Apple, allowing iPhones to be sold at a discounted rate, and eschew the monthly stipend, instead keeping the entire monthly subscriber yield to themselves.

Pretty interesting, but I think MR Members already knew this info.

 

[freediverdude]

I don't see how it could be upfront. Otherwise how could Apple sell them directly for the subsidized price? It sounds to me like Apple gets a subsidy payment after each activation on AT&T. That's why they'll be so strict about not letting any phones out the door without signing up.

 

[SFStateStudent]

I don't see how it could be upfront. Otherwise how could Apple sell them directly for the subsidized price? It sounds to me like Apple gets a subsidy payment after each activation on AT&T. That's why they'll be so strict about not letting any phones out the door without signing up.

That's what it sounds like to me as well, and that's why I highlighted/bolded that portion of the article. I just wish Apple or AT&T would just come out and say "who's getting what; and how much they are getting!"

 

[freediverdude]

I have a feeling this is in response to AT&T probably complaining about so many being unlocked. If the unlocking community had remained just a few thousand diehards, they would not have cared, but since it turned into such a large and vibrant community, they probably felt they had to do something, unfortunately.