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MyiBill

macrumors 6502
Original poster
Feb 8, 2012
379
31
What if Apples next big thing isn't the iWatch or TV. What if Apple creates or buys an existing cellular service such as T-Mobile and creates free service for iPhones and iPads. You would get unlimited free calling, text and data for 2 years and all iPhones would cost full retail. Same for iPads. Suddenly the iPhone is the most high-end "budget" phone available, no service fees, no contracts. An entire industry that is growing and creating huge profits is suddenly turned upside down. No one would be able to compete.
 

thehustleman

macrumors 65816
Jan 3, 2013
1,123
1
What if Apples next big thing isn't the iWatch or TV. What if Apple creates or buys an existing cellular service such as T-Mobile and creates free service for iPhones and iPads. You would get unlimited free calling, text and data for 2 years and all iPhones would cost full retail. Same for iPads. Suddenly the iPhone is the most high-end "budget" phone available, no service fees, no contracts. An entire industry that is growing and creating huge profits is suddenly turned upside down. No one would be able to compete.

It wouldn't be financially viable.


And the most high end budget phone available is the nexus 5
 

MyiBill

macrumors 6502
Original poster
Feb 8, 2012
379
31
It wouldn't be financially viable.


And the most high end budget phone available is the nexus 5


But it wouldn't be much of a stretch either. One could say that a large portion of your monthly bill goes to cover the $500 subsidy on your new smartphone. The carrier really makes money when you don't upgrade every year. Apple wouldn't need a subsidy and would likely sell twice as many iPhones in the process.
 

scaredpoet

macrumors 604
Apr 6, 2007
6,627
342
I hope Apple buys Chevrolet ... and gives us new cars for free :apple:

oprah19139277.jpg
 

AFDoc

macrumors 68030
Jun 29, 2012
2,814
558
Colorado Springs USA for now
I love when tweeners sitting in mommy and daddy's basement decide apple is awesome and can do anything and better than anyone.


They would get KILLED because they have no history with cell infrastructure. All they do is design products, that's it. Thanks for the comedy relief though.
 

docal97

macrumors 6502a
Jun 28, 2006
785
49
Southampton
But it wouldn't be much of a stretch either. One could say that a large portion of your monthly bill goes to cover the $500 subsidy on your new smartphone. The carrier really makes money when you don't upgrade every year. Apple wouldn't need a subsidy and would likely sell twice as many iPhones in the process.

Remember that the average bill is about $50/month at least. That's $1200 over the course of a 2 yr contract. So buying a phone for $600, when the average subsidy is about $200 or so, doesn't add up.

But it would be a great thing for customers though.
 

MyiBill

macrumors 6502
Original poster
Feb 8, 2012
379
31
I love when tweeners sitting in mommy and daddy's basement decide apple is awesome and can do anything and better than anyone.


They would get KILLED because they have no history with cell infrastructure. Thanks for the comedy relief though.

Obviously they do if they make cell phones, they have to have somewhat of a knowledge of the inner workings. If they were to buy an existing cellular company than they point would be mute. By the way we were talking about this is my college finance class so yeah.
 

MyiBill

macrumors 6502
Original poster
Feb 8, 2012
379
31
lol ... seriously? :cool:

Yeah the professor brought up how tmobile is offering the free data on the new iPad and how that factors into being a good business decision. It snowballed into talking about apples massive profits and cash pile and someone said why doesn't Apple buy tmobile and offer free service and turns out its no that out there. If the average bill is $80 a month for 1 iPhone then thats $1920 over 2 years minus the $500 subsidy that a $1420 revenue for the carrier. Its cost them maybe $100 a year for various expenses and maintenance for that 1 line leaving a profit of $1220 after 2 years of a contract. Now if Apple were to offer free service we estimated they would sell twice as many iPhones more that making up for the $200 cost per phone it would cost them to run the service for 2 years.
 

Apple OC

macrumors 68040
Oct 14, 2010
3,667
4,326
Hogtown
Yeah the professor brought up how tmobile is offering the free data on the new iPad and how that factors into being a good business decision.

lol ... does he also work at tmobile on weekends?

sorry dude ... this will never happen :apple:
 

MyiBill

macrumors 6502
Original poster
Feb 8, 2012
379
31
lol ... does he also work at tmobile on weekends?

sorry dude ... this will never happen :apple:


Nah he just likes apple and when they announce something new he likes to talk about it and goes into their previous quarter sales and whatnot.
 

AFDoc

macrumors 68030
Jun 29, 2012
2,814
558
Colorado Springs USA for now
Obviously they do if they make cell phones, they have to have somewhat of a knowledge of the inner workings. If they were to buy an existing cellular company than they point would be mute. By the way we were talking about this is my college finance class so yeah.

They can DESIGN a phone and make it so all the components fit but they don't "make" anything. The point wouldn't be moot as they have no clue what their doing..... they could keep every employee but they would still get crushed as any telecom they could buy would most likely have sub-par equipment and they'd have to spend millions/billions to make it competitive. PLUS there is that pesky tidbit of not knowing anything about the provider side of the business. Add on the fact that IF they were able to buy a telecom that means it was probably not doing well so why would you keep those know nothings on after they bought it?
 

thehustleman

macrumors 65816
Jan 3, 2013
1,123
1
Yeah the professor brought up how tmobile is offering the free data on the new iPad and how that factors into being a good business decision. It snowballed into talking about apples massive profits and cash pile and someone said why doesn't Apple buy tmobile and offer free service and turns out its no that out there. If the average bill is $80 a month for 1 iPhone then thats $1920 over 2 years minus the $500 subsidy that a $1420 revenue for the carrier. Its cost them maybe $100 a year for various expenses and maintenance for that 1 line leaving a profit of $1220 after 2 years of a contract. Now if Apple were to offer free service we estimated they would sell twice as many iPhones more that making up for the $200 cost per phone it would cost them to run the service for 2 years.

The cost of providing that service would be too huge.

Billions spent just getting the infrastructure together.

Then what about other/superior phones like the note 3 ALREADY operating on the network? Would apple continue to service them since they aren't iPhones or would they just have to pay their bill to apple?

OK, buy a 700$ iPhone, free service for 2 years is a huge burden on apple having to administer the network, plus if it's t-mobile it would be quite janky!

T-Mobile is the smallest carrier for a reason
 

Mrbobb

macrumors 601
Aug 27, 2012
4,992
196
So obviously they want to do this because..... they want to sell more phones.

Why would then Verizon and the other carriers want to sell iPhones when Apple becomes a direct competitor?

But this is against Apple's core. Cook has repeated Apple does a few things very well. Running a carrier sounds like too much complication.
 

Carlanga

macrumors 604
Nov 5, 2009
7,118
1,396
But it wouldn't be much of a stretch either. One could say that a large portion of your monthly bill goes to cover the $500 subsidy on your new smartphone. The carrier really makes money when you don't upgrade every year. Apple wouldn't need a subsidy and would likely sell twice as many iPhones in the process.

large portion to cover MSRP price, nope.
 

Mrbobb

macrumors 601
Aug 27, 2012
4,992
196
If Apple continues to rely on its (old) phone business then it will become another one-product company like HP (printer), and Microsoft (Windows).
 

boomhower

macrumors 68000
Oct 21, 2011
1,562
50
Won't happen. As we know Apple will not do something unless it's 100%. Buying a substandard carrier like T-Mobile just isn't going to happen as the service is substandard. T-Mobile doesn't even have 3G in my area, they are still rocking 2G. AT&T and Verizon has LTE and Sprint is edging closer so it's not like I live in the middle of nowhere, town has around 12,000 population. Apple would need to buy Verizon to offer the service at their standards and that definitely isn't going to happen.

Beyond that offering service for free for two years with a phone purchase cannot be a sustainable business plan.
 

Small White Car

macrumors G4
Aug 29, 2006
10,947
1,334
Washington DC
They can DESIGN a phone and make it so all the components fit but they don't "make" anything. The point wouldn't be moot as they have no clue what their doing..... they could keep every employee but they would still get crushed as any telecom they could buy would most likely have sub-par equipment and they'd have to spend millions/billions to make it competitive. PLUS there is that pesky tidbit of not knowing anything about the provider side of the business. Add on the fact that IF they were able to buy a telecom that means it was probably not doing well so why would you keep those know nothings on after they bought it?

Not sure why this is so hard in your mind.

Apple could buy Sprint and tell them to just keep doing their thing. (You know, other than giving iPhones special treatment.) But besides that Sprint sure as hell knows how to do all that other stuff.


Now, this is still a terrible idea because:

A) It's U.S. only. Apple would spend a lot of money to only cater to a portion of their audience.

B) Apple couldn't just shut down the rest of Sprint's business (without losing a ton of money) so they're now running a businesses they have no interest in.

C) Profit margins in this business are far lower than what Apple normally makes, so even in the part of Sprint that's doing "Apple stuff," they're not making nearly as much money as they're used to. It's just a big sink hole that takes wastes money and doesn't gain them much.



So, yeah, it is a terrible idea. But not for any of the reasons you've been posting.
 
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