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Summary:

Does it actually surprise anyone that, according to a recent Wall Street Journal report, AT&T would be looking to extend their exclusivity contract with Apple to be the sole official U.S. iPhone carrier? If it does, I will begin to lose faith in the intelligence of […]

attlogoDoes it actually surprise anyone that, according to a recent Wall Street Journal report, AT&T would be looking to extend their exclusivity contract with Apple to be the sole official U.S. iPhone carrier? If it does, I will begin to lose faith in the intelligence of our readers. The journal report claims that the exclusivity deal expires next year in 2010, and that AT&T are working towards extending that date to at least 2011 in order to keep the massive revenue generator in their camp.

AT&T President Randall Stephenson hopefully has a few things up his sleeve for moving AT&T out of the dying landline business and increasingly toward the much more lucrative and future-proof mobile wireless market. Clearly, securing iPhone carrier exclusivity would be high among his goals then, since 4.3M iPhone subscribers joined up in the second half of 2008, nearly half of whom were new to AT&T.

Problem is, from where I’m standing, AT&T probably isn’t in a very good bargaining position at the moment. Sure, they’re building out their network as fast as they can to keep up with the additional strain put on their 3G network by iPhone demand, but what kind of carrot could they possibly wave in front of Apple to really convince them that selling their phone to more people on multiple networks isn’t the better deal?

The answer is money. They could offer Apple a revenue sharing model that is extremely generous, and subsidize upcoming handsets to the point where Apple could potentially offer the iPhone at a lower price point and expand their user-base even more. The key ingredient will be network buildout, though, since Apple is unlikely to stick around if AT&T can’t get its act together enough to even allow for more subscribers, regardless of how either company intends to attract them. That’s good news for current subscribers, because it means they should see significant improvements in service through at least 2011.

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  1. I apologize for the newby question, but is the iPhone rumored to be launched in June going to be on a new 4G AT+T network, or will AT+T not be ready in time for that?

  2. Apple Takes It On The Chin as BlackBerry Curve Surpasses iPhone in Popularity Monday, May 4, 2009

    [...] in the works, and if true, this would almost certainly nab them another. If, as some suggest, their exclusivity deal with AT&T comes to an end, expect them to grab even more ground from [...]

  3. Apple Takes It On the Chin: BlackBerry Curve Surpasses iPhone in Popularity Monday, May 4, 2009

    [...] in the works, and if true, this would almost certainly nab them another. If, as some suggest, their exclusivity deal with AT&T comes to an end, expect them to grab even more ground from [...]

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