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U.S. Cellular Turned Down iPhone over 'Unacceptable' Terms from Apple
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its too bad. They have much much better coverage here in Maine than AT&T -- they have covered most of the state for a long time while AT&T served mostly the Portland metro area for a long time, and now has pretty incomplete statewide coverage (expanded to the i95 corridor and most reasonably sized towns and cities, with significant dead spots between towns that are covered by US Cellular). I left US Cellular to get the iPhone, and just signed a new 2-year contract with AT&T after I had been off contract for a while. I would have considered going back.
Our USC lines ...
We left USC for the very reason that they didn't offer an iPhone and seemed to be betting on Android, their Android offerings are lukewarm at best because of USC's critical control/restrictive approval process for phones on their network.
Their network is great, but historically they have always been 'the last' to get the best devices. I would gladly return to USC if they got an iPhone, but I am too invested in iOS to go back for anything but an iThing.
We left USC for the very reason that they didn't offer an iPhone and seemed to be betting on Android, their Android offerings are lukewarm at best because of USC's critical control/restrictive approval process for phones on their network.
Their network is great, but historically they have always been 'the last' to get the best devices. I would gladly return to USC if they got an iPhone, but I am too invested in iOS to go back for anything but an iThing.
Don't question the brilliant people of this forum. They know what they're talking about!
and if the agreement to carry the iPhone would be unprofitable for them (aka they loose money on the iPhone) why would you leaving be worse. It would cost them more than they could get off you to carry the iPhone.
All signs point to the fact that Apple's requirements and cost to carry the iPhone are much higher per phone than others.
I know U.S. Cellular offers services in 26 or so states. What happens when you go to an area where they do not provide service? Do you get service? Do you have to pay extra?
If I get service and if I do not pay roaming, then how does it matter to me if they are regional or nationwide?
They used to have an unlimited incoming call plan ( not sure if they still do ) and I know a few people who loved them just for that.
What is the cheapest plan you can get today for a limited minutes voice and restricted 3G data plan, without considering what smartphone one uses?
I'm doing the same soon enough. I just need to actually move but I've been lazy so far.
You mean including the iPhone, or willing to use whatever phones are offered on that network?
So many sour grapes comments!
Guys, there is nothing wrong with a carrier deciding it wasn't in their best interest to sell the iPhone! I imagine this company's rates are probably pretty low compared to the big guys, so they would probably not make enough money back off the iPhone to pay off the subsidy. This is economics, this is competition (between cell providers). There's no problem with one of them deciding the iPhone was too expensive!
Guys, there is nothing wrong with a carrier deciding it wasn't in their best interest to sell the iPhone! I imagine this company's rates are probably pretty low compared to the big guys, so they would probably not make enough money back off the iPhone to pay off the subsidy. This is economics, this is competition (between cell providers). There's no problem with one of them deciding the iPhone was too expensive!
When I first moved to the mid-west I had them as a carrier with the Motorola Star Trac flip phone. Great phone, horrible service. I also found out (at least during that time) they didn't have any cell towers of their own, but piggy backed off of other carriers.
I know you're only kidding, but anyway . . .
When the big carriers are falling all over themselves to get in on the Apple action? Even years later, as if the iPhone were a brand new phenomenon?
Hardly.
4 million units sold over a weekend is nothing to sneeze at. That's 4 million units that "US Cellular" didn't sell. They have their reasons, but some kind of inability is probably at the top of the list. That's a budget carrier for ya . . .
http://www.bgr.com/2011/11/04/iphon...one-at-top-3-u-s-carriers-iphone-4-still-hot/
iPhone 4S now No.1 smartphone at top-3 U.S. carriers, iPhone 4 still hot
Apple looks to be following up its surprising miss in the September quarter with a huge holiday quarter for its popular iPhone line. According to Canaccord Genuity’s checks, Apple’s iPhone 4S was the best-selling smartphone in October for Verizon Wireless, AT&T and Sprint despite only being available for half of the month. Apple’s previous-generation smartphone, the iPhone 4, was also found to be among the three top-selling smartphones at each of the country’s top-3 carriers.
Yeah. My bet is the biggest sticking point over the iPhone was the subsidies. It's fairly well established that the subsidies demanded by Apple for iPhones are higher than just about any other phone, and Apple is inflexible on that.
Apple, in all likelihood, wasn't demanding anything from US Cellular that they don't require of every other carrier partner worldwide.
i.e.,
- The carrier pays Apple the full $650+ price for each iPhone
- The carrier must offer the phones at Apple's standard $199/299 etc price points, when sold on a two-year contract
- The phones are sold unmodified: no carrier branding, no carrier add-on software, etc.
Translation: Apple demands that the carrier pays a $450 subsidy for each iPhone sold on a two-year contract, and bars the carrier from treating the phone like a billboard (both for themselves, and via auctioning to third parties the right to have things pre-installed). Apple's policies on all these points is totally non-negotiable.
Reading between the lines that Apple's "terms were unacceptable from a risk and profitability standpoint", it seems pretty clear to me that US Cellular is not confident that they could make enough operating profit on each subscriber over a two-year period (i.e., force them to stay in a high-enough priced rate plan) to recoup that $450 subsidy.
If Apple did ask a commitment for some minimum number of iPhone sales -- I don't think this sort of requirement has ever been confirmed, but it's certainly plausible -- it would of course have been based on the current size of US Cellular's customer base. Supposing they are perceived as more of a discount carrier, they may have thought it risky to commit to (effectively) converting that proportion of their customer base to iPhone users who (to cover the subsidies) would necessarily be on relatively high-priced plans. This is probably the one area where US Cellular has a shot at talking Apple down to a lower number... but apparently, not low enough.
It's quite reasonable for Apple to ask these commitments of carriers, too: it allows Apple to plan for that number of sales, which in turn helps them maintain their rock-solid control of the manufacturing pipeline. There's costs associated with working with a new carrier partner, and Apple wants to be absolutely sure there will be enough sales to make it worth the trouble. This sort of up-front commitment also provides incentive for the carrier to actively push the iPhone through their marketing and their sales staff, enhancing the visibility and prestige of the iPhone brand.
In the end: neither side of these negotiations is wrong, or stupid, or evil. Apple knows they have the hottest phones in the world, and sticks to a hard line in their bargaining. Meanwhile, US Cellular simply can't justify the business risks that Apple asks of them.
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Most carriers don't own their towers, they lease space on them and hang on an antenna. Some also leas bandwidth to marketing companies so they can become virtual service providers.
Dillenger said:
Most carriers don't own their towers, they lease space on them and hang on an antenna. Some also leas bandwidth to marketing companies so they can become virtual service providers.
i agree. a few years ago i was at a wedding in southern wisconsin and could not get a signal on my [semi-smart] verizon phone, and had to borrow my sister's non-smart, flip phone on US Cellular, which had no problem with reception up there. But unfortunately i will likely be going back to verizon (from T-Mo) because it's time for me to have an iphone.
US Cellular would be $20/line per month cheaper for us. 450 minutes, unlimited texts, nights starting at 7 (instead of 9), and 5GB data (instead of unlimited/2GB cap) is $79.99. Paying $99.99 for 450 minutes, 250 texts, and unlimited (throttled after 2GB) data. US Cellular also uses Verizon's network in spots for roaming, so coverage would be just as good. If US Cellular would have gotten the iPhone I would have switched our lines in a heartbeat.
Yeah, possibly .....
I don't know though? Reality is, there are still an awful lot of people out there on tight budgets, who struggle just to pay a cellphone bill for a basic voice phone with a texting plan. They're either not that interested, or it's financially not feasible for them to move up to a smartphone.
Now that even Sprint has the iPhone, the remaining carriers like U.S. Cellular might see an opportunity in refusing any phone handsets that cost them money to offer people.
The potentially foolish part of this, for them, is that it places them more squarely in people's minds as a "budget carrier" -- and not one worthy of using if you're going to spend more and have bigger requirements.
I don't know though? Reality is, there are still an awful lot of people out there on tight budgets, who struggle just to pay a cellphone bill for a basic voice phone with a texting plan. They're either not that interested, or it's financially not feasible for them to move up to a smartphone.
Now that even Sprint has the iPhone, the remaining carriers like U.S. Cellular might see an opportunity in refusing any phone handsets that cost them money to offer people.
The potentially foolish part of this, for them, is that it places them more squarely in people's minds as a "budget carrier" -- and not one worthy of using if you're going to spend more and have bigger requirements.
Yep, it's $130 for two lines 700 shared minutes, unlimited text, and 200 megs monthly for data. That's still $30 more than T-Mobile which has unlimited minutes and 2 gigs data.
If you want to compare bare bones, TM has a plan two lines, 1000 shared minutes, 200 megs data, unlimited text for $69. Still close to half of what it costs on ATT for more minutes (and after the 200 meg limit it's throttled data instead of overage charges).
iPhone would be awesome and I'd even be fine buying it outright, but if it means double the monthly bill that's a dealbreaker.
Not quite like Cricket, though....
Honestly, Cricket *is* a budget carrier in EVERY sense of the word. Here in St. Louis, MO -- most Cricket Wireless stores are run by shady looking foreigners who price all the accessories they sell at basically whatever they like.
(One store I visited had an Asian guy working there who informed me "everything is $15" when I asked him for the price of a couple different phone cases, and then a car charger.)
Often, you get the best deal from Cricket when you purchase the phone and select your plan online (self-service), vs. anything a local dealer can offer you.
When you have billing issues (and you're practically guaranteed to, if you ask Cricket to make any changes to an existing plan, or order anything more complex than some basic advertised package on a basic, non-smart phone), the foreigners answering their "customer service" line are typically rude and uninterested in helping you out. I got hung up on in the middle of calls to them several times, while trying to get them to fix an incorrect charge on a bill.
And lastly, Cricket uses a portion of the CDMA spectrum reserved for "second tier" carriers -- so you can't put very many phones on their network even if you want to. You're stuck buying one of the very limited selections of phones they sell, so you get one that can physically operate on their "tri-band" frequencies they use in most major markets.
I've had U.S. Cellular before too, and they're FAR superior to Cricket's operation. They operate full-blown retail stores similar to what AT&T or Verizon has. Their call quality was excellent when I used them, and I basically never dropped a call while driving around. Never had any billing issues either. The ONE area they compromise in consistently is in offering second-rate phones that nobody really wants.
Honestly, Cricket *is* a budget carrier in EVERY sense of the word. Here in St. Louis, MO -- most Cricket Wireless stores are run by shady looking foreigners who price all the accessories they sell at basically whatever they like.
(One store I visited had an Asian guy working there who informed me "everything is $15" when I asked him for the price of a couple different phone cases, and then a car charger.)
Often, you get the best deal from Cricket when you purchase the phone and select your plan online (self-service), vs. anything a local dealer can offer you.
When you have billing issues (and you're practically guaranteed to, if you ask Cricket to make any changes to an existing plan, or order anything more complex than some basic advertised package on a basic, non-smart phone), the foreigners answering their "customer service" line are typically rude and uninterested in helping you out. I got hung up on in the middle of calls to them several times, while trying to get them to fix an incorrect charge on a bill.
And lastly, Cricket uses a portion of the CDMA spectrum reserved for "second tier" carriers -- so you can't put very many phones on their network even if you want to. You're stuck buying one of the very limited selections of phones they sell, so you get one that can physically operate on their "tri-band" frequencies they use in most major markets.
I've had U.S. Cellular before too, and they're FAR superior to Cricket's operation. They operate full-blown retail stores similar to what AT&T or Verizon has. Their call quality was excellent when I used them, and I basically never dropped a call while driving around. Never had any billing issues either. The ONE area they compromise in consistently is in offering second-rate phones that nobody really wants.