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AT&T Hopes For iPhone Exclusivity Until 2011
CEO says talks with Apple are underway...
by Karl Bode Wednesday 15-Apr-2009 tags: business · wireless · Cingular Wireless
There have been rumblings that in 2010, when AT&T's exclusive deal with Apple ends, Verizon would begin offering an EVDO version of the iPhone to their customers. But AT&T CEO Randall Stephenson tells the Wall Street Journal that he's in negotiations with Apple to extend AT&T's exclusive iPhone contract until 2011. That may be sorry news for iPhone users in markets where AT&T 3G connectivity either hasn't been deployed, or isn't particularly robust. Apple so far isn't commenting, only saying "we have a great relationship with AT&T."

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mystryfiostk

join:2008-07-17
00000

milk it at&t

will the iphone be to at&t like sunday ticket is to directv??

milkerman

@bellsouth.net

Re: milk it at&t

Well if it works for them, why try to end it?

andunn

join:2001-09-06
Linn Creek, MO

Re: milk it at&t

It's all about the money. I'm sure what will happen is that when AT&T is done talking to Apple and they have their offer. Apple will then take that offer or tell Verizon this is what we think AT&T is going to offer. Then say to Verizon if you want the iphone beat this. Then we get to see how badly both want the iphone.
Sammer

join:2005-12-22
Canonsburg, PA

Re: milk it at&t

said by andunn:

I'm sure what will happen is that when AT&T is done talking to Apple and they have their offer. Apple will then take that offer or tell Verizon this is what we think AT&T is going to offer. Then say to Verizon if you want the iphone beat this. Then we get to see how badly both want the iphone.
It's more complicated than that, Apple has to decide if it can make more money with a single wireless carrier or whether they can make more by offering it to all (who are willing to pay) U.S. carriers.

Homer J
Mmmm, Free Goo

join:2000-10-05
Springfield

Re: milk it at&t

It would seem to me they would make more with all carriers having the phone. That would give them a much larger base of potential customers. My wife and I talked about getting Iphones, but did not want to change to AT&T so they lost 2 potential customers right there.

cdru
Go Colts
Premium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:7

Re: milk it at&t

said by Homer J:

That would give them a much larger base of potential customers.
This is countered by AT&T paying a huge premium to Apple to have exclusive rights. AT&T could afford to pay those premiums as Apple/iPhone was attracting flocks of customers to join AT&T. I don't know what the actual numbers are, but is it better to have AT&T pay $10/customer, or 5 different carriers $2. Which brings in more customers in the end?

The iPhone was novel when it first came out. There really wasn't anything on the market that could rival it. However the market has changed.

I just recently purchased a G1, based on Google's Android OS. It's "app store" isn't as extensive as the iPhones, but it has many of the same types of popular applications. It has similar feature sets as the iPhone plus additional things the iPhone can't do currently. Plus the OS it's not tied to a single carrier. The G1 is only currently offered from T-Mobile, but it's available directly from google unlocked or from the manufacturer as the HTC Dream. Additional makers are in the process of bringing out their own Android phones in the coming months.

With legitimate competitors coming on to the scene, the advantage of the exclusivity of the iPhone I think will wear off. It may be more attractive to Apple, but I think AT&T will offer less as they will have a harder time drawing people in with competing phones that offer more features for less available elsewhere.
patcat88

join:2002-04-05
Jamaica, NY
kudos:1

Re: milk it at&t

So what on earth is the difference between Android, WM, Symbian and iPhone OS other than to various attempts to embrace, extend, extinguish, and monopolizing developers?

Windows Mobile OS is fine for me. My Windows Mobile phone is 5 years old, and I love it. I can compile and install my own stuff for it, its similar to Desktop Windows from API point of view, and some of Desktop Windows registry hacks work on Windows Mobile identically.

cdru
Go Colts
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join:2003-05-14
Fort Wayne, IN
kudos:7

Re: milk it at&t

said by patcat88:

So what on earth is the difference between Android, WM, Symbian and iPhone OS other than to various attempts to embrace, extend, extinguish, and monopolizing developers?
I can't speak to the specific details to each OS. Some have been open source from the beginning (Android), some may be truly open some day (Symbian OS), and some almost guaranteed will never be be open source (iPhone and Microsoft). Most of the OSes were designed for interoperability with with one system specifically. Android works in unison with all of the google apps (Gmail, maps, calendar, etc), Windows Mobile with office and Live.com, iPhone with...I don't know.

One of the big difference in the different phones is what it takes to be a developer. With Android, anyone can become a developer, access the OS source or SDK for free, and create their own apps, extending and embracing the application. Google might be able to change the license in the future, but since it's already been open and if they accept outside contributions to the official build that could be very difficult. You don't have to have any type of blessings from T-Mobile or Google to install your own apps. Google pulled a tethering app from their marketplace, but you can easily download it and install it form several different places on the net.

Compared to Apple's SDK that requires you to pay a minimum of $99 just to be able to develop applications. You must apply for a license and there isn't a guarantee that you'll be accepted. Plus then you have to sign a developer agreement on what you can an cannot do with your application and device. Once you have an application, but must release it through Apple's iStore after it's been cryptographically signed and have their blessing. Non-signed apps won't run on the iPhone unless it's been jail broken, officially a no-no in Apple/AT&T's eyes.

Just like with desktop PCs, choice is always good. I can choose between multiple different versions of Windows, Linux and OS-X (which has it's roots in *nix/BSD). Similarly, my phones can be based on different OSs and have features that the others don't support, or if they don't support them they may or may not be able to support them. If the iPhone didn't have any competitors, where's the incentive to be innovative?

I had a HTC Touch (aka T-Mobile Wing) for almost 3 years that was running a modified version of Windows Mobile I grabbed from XDA-Developers. It worked decent, but it was slow and had limited memory. The touch screen also wasn't sensitive (or maybe that should be too sensitive) and my fat fingers wouldn't register as presses all the time, especially on small buttons or text. The mobile version of IE also sucked on most websites. Part of these limitations were probably because of the age of the phone. But I think some of the kudgyness of some apps comes from a desktop OS that was ported to a mobile device.

After upgrading to the G1, the screen is much more responsive to my fat fingers. Navigation is easier as the screens were designed for a mobile phone, not for a desktop-look-a-like screen. I've yet to get a out-of-memory error. The browser renders pages much better and is actually usable on most websites I've been too. Android also has the ability to run applications in the background, something the iPhone has yet to figure out how to do.

Mchart
First There.

join:2004-01-21
Gurnee, IL
The G1 definatly has a few interesting features with how they setup the Android OS on the phone. However, the device is still nowhere near competing with the iPhone in terms of raw power. The iPhone has both a faster CPU, and dedicated GPU. This makes it possible for games like Galaxy on Fire, which the G1 would never be able to run. I'd say the only real feature(s) the G1 has going for it over the iPhone is the keyboard, and the fact that you can easily replace the battery. For anyone thats used an iPhone, however, the keyboard is a null issue as if one has actually used an iPhone you would know the touch keyboard works just as good. The battery issue is really the only determining factor I can think of besides being locked into one of the specific carriers. The bottom line is that the Palm Pre is the only phone soon to be released / out now that is actually capable of competing with the iPhone. The G1 just doesn't have the raw power to run some of the apps that the iPhone can.

cdru
Go Colts
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join:2003-05-14
Fort Wayne, IN
kudos:7

Re: milk it at&t

said by Mchart:

The G1 definatly has a few interesting features with how they setup the Android OS on the phone. However, the device is still nowhere near competing with the iPhone in terms of raw power. The iPhone has both a faster CPU, and dedicated GPU. This makes it possible for games like Galaxy on Fire, which the G1 would never be able to run.
Is it a phone or a video game?

Seriously though, is the CPU and/or graphics limitation a matter of the G1 being the first real mobile device to run Android? Or a limitation of the Android OS itself? Did the first iPods that came out run Galaxy on Fire? There is a video floating around on Youtube of Quake running on an Android phone. Yes Quake isn't exactly the latest in 3D games, but it's been a litmus test of sorts for a long time as to 3D gaming.
Big Dawg 23

join:2002-03-27
Northfield, MN

Re: milk it at&t

I have had a XV6800 and now a Storm. A coworker has G1. There are some nice things with the G1 however it is not as nice as the Iphone. I prefer my Storm over the G1. Once you have a screen that big and nice it is hard to look at something else. My coworker with the G1 likes my Storm but not the Touch only screen.

Many believe the Iphone is the greatest thing since slice bread. In its current state I don't understand that. It has had several software updates but until 3.0 comes out there is no MMS, Cut and Paste, Stereo Bluetooth or Video Recording. All of this appears to be available if you jailbreak the phone. I know several people who did just that and moved it to T-Mo.

Other downsides to the Iphone compared to the Storm and G1 is the inability to put in a larger battery. That limitation by Apple boggles my mind. As a phone I do not care for the Iphone however when my Nano dies it will be replaced with Itouch.

Mchart
First There.

join:2004-01-21
Gurnee, IL
The iPhone has games using the Quake 3 engine, and games such as Livefire (Which comes out within the next month) are basically Quake 3 Arena and have full online multiplayer assuming one is connected to the internet via Wifi or 3G.

tiger72
SexaT duorP
Premium
join:2001-03-28
Saint Louis, MO
kudos:1
said by Mchart:

The G1 definatly has a few interesting features with how they setup the Android OS on the phone. However, the device is still nowhere near competing with the iPhone in terms of raw power. The iPhone has both a faster CPU, and dedicated GPU.
The CPU on the G1 is just clocked down. There's an overclocking app in the market which allows the user to overclock, and I must say that the performance increase is very noticeable, and makes my experience lagless. So, it may not have a dedicated GPU still, but the CPU argument can be dismissed imo.
This makes it possible for games like Galaxy on Fire, which the G1 would never be able to run. I'd say the only real feature(s) the G1 has going for it over the iPhone is the keyboard, and the fact that you can easily replace the battery. For anyone thats used an iPhone, however, the keyboard is a null issue as if one has actually used an iPhone you would know the touch keyboard works just as good.
That's simply not true. Everyone and their mother has an iPhone. It's practically the new razr. I've used the virtual keyboard, and I'm not impressed. My current build of Android on my G1 also has a virtual keyboard (which I like better than the iPhone vk), and I still prefer to use the G1 physical keyboard over the virtual keyboard. It's a matter of personal preference. My own is that I still prefer the physical keyboard.
The same argument can be made for the multi-touch. While I had software on my G1 (like the browser) which was multi-touch capable, and emulated the iPhone multitouch, I also decided not to use it because it was more "pretty" than it was useful. I still feel that multitouch limits usability by taking away 1-handed operation.
The battery issue is really the only determining factor I can think of besides being locked into one of the specific carriers. The bottom line is that the Palm Pre is the only phone soon to be released / out now that is actually capable of competing with the iPhone. The G1 just doesn't have the raw power to run some of the apps that the iPhone can.
Based upon what? I'm willing to put money down that you haven't actually used a G1. Especially not one with a recent Android 1.5 OS build.

It's really a shame that Android 1.5 didn't ship with the G1. Because lining up the upcoming iPhone to the G1 with Android 1.5, the G1 STILL has better features than the iPhone in all but 2 categories: 3d gaming and design. And neither of those is a flaw in Android, but a shortcoming of the G1.
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Mchart
First There.

join:2004-01-21
Gurnee, IL

2 edits

Re: milk it at&t

The CPU on the iPhone is clocked down as well. So the argument that the G1 is 'just as' powerful really just is not possible.

The argument that the G1 not having a GPU is not a big factor is a load of balony and you know it. You won't see games with graphics equivelant to that of Quake 3 without it. The GPU on the iPhone is what allows it to run the stuff that it can without hesitation. One can be playing music using the 'iPod' feature on the iPhone in the background, and load up Galaxy on Fire and play without any loss in framerate. Thats a huge amount of processing going on. Bottom line is that overclocked or not - The iPhone is a much more powerful handheld. The fact that John Carmack and id have jumped into the iPhone/iPod touch market with both feet should tell you something. Beyond making money, they know it's the new gaming device out there. If you read his development diary you'll see they wouldn't have even touched the iPhone if it wasn't for the fact that it did indeed have a dedicated GPU.

The point is - Android may very well be better, but the G1 simply is not. Of course, my original point was just that. So please, don't take it otherwise (Even though you allready have).

Linklist
Premium
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Longport, NJ
kudos:5
said by andunn:

It's all about the money. I'm sure what will happen is that when AT&T is done talking to Apple and they have their offer. Apple will then take that offer or tell Verizon this is what we think AT&T is going to offer. Then say to Verizon if you want the iphone beat this. Then we get to see how badly both want the iphone.
Will Apple be bribed enough by AT&T to keep the iPhone from other US wireless providers?
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fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3
said by milkerman :

Well if it works for them, why try to end it?
Why? that's being asked here... on BBR? Why? Because it's ANTI-CONSUMER to allow it to go on, just as is it for the Sunday NFL game package that DirecTV has a hold on.

The NFL is stupid for letting DirecTV have exclusive rights to it as there are more customers out there for them to have, that probably won't subscribe becuase either 1) They can't have a dish, or 2) won't go to DirecTV from Dish, uVerse, Cable, FiOS, etc. These idiots cut their own throat.

Also, the iPhone.. there are people that avoid AT&T like the plague.. I'm one of them. I HAVE an account with them but it's becuase work requires it. But, they get as little money as possible. My money goes to Sprint, well, it went to Nextel, but you know...

There are people that want to get the iPhone but are waiting for it to hit the network THEY chose to use.. so why limit? Apple would be fools to extend the contract for more time with AT&T. As it was said earlier, their 3G network isn't very robust like other providers. It's time these so-called "ultra premium" phones stop hailing themselves as some kind of god-like devices, stop screwing around, and start making real money on them by opening them up to the market.

And, quite honestly, if AT&T needs the iPhone SOOOOOO much, what does that say about their service? If the ONLY thing keeping a customer to AT&T is the iPhone, then maybe they need to start looking at other ways to keep their customer other than putting their eggs in apple's basket..
patcat88

join:2002-04-05
Jamaica, NY
kudos:1

Re: milk it at&t

Its better to shift the responsibility for sales to a 3rd party (Apple, DirecTV), and hold yourself blameless for bad results.

The money/profit you would make by just offering it to one party, will offset the extra volume you would push through at lower prices. Offer it to multiple 3rd parties and they will compete against each other on who can sell your product for less.
glinc

join:2009-04-07
New York, NY

meh

I really wished Verizon took the deal back when Apple offered it to them first....I don't want to switch to AT&T due to drop calls and poor 3G coverage.
flankspeed8

join:2001-07-20
Hastings, MN

Re: meh

This is why I am not with at&t now. I will NEVER have an iPhone until it is available on Verizon. I know there are hundreds of thousands more like me out there. Exclusivity sucks....Come on Apple, go after the leader...

en102
Canadian, eh?

join:2001-01-26
Valencia, CA

Re: meh

After having poor service with Verizon Wireless in the past, I'd never go back to them. Their CEO would have to come and kiss my a$$ on TV first.

I don't use the iPhone, however, I do use AT&T service, and have had a much better experience since I cancelled Verizon Wireless.
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dcdeadbeat5

join:2008-10-07
Washington, DC

Re: meh

said by en102:

After having poor service with Verizon Wireless in the past, I'd never go back to them. Their CEO would have to come and kiss my a$$ on TV first.

I don't use the iPhone, however, I do use AT&T service, and have had a much better experience since I cancelled Verizon Wireless.
I second that. I paid the fee to get out of my contract with Verizon Wireless because I kept getting dropped calls. And this was in downtown D.C.!!!!

I have never had a problem with AT&T Wireless.

nix

@cox.net
AT&T's service is miserable

eric212

@verizon.net
im a AT&T user in west virginia and they by far have the best coverage in my state and this state is the hardest to get reception due to all the mountains so ATT has good coverage and i havnt had a drop called in the 2 yrs ive been with them so i would look at ur records and adjust them
flankspeed8

join:2001-07-20
Hastings, MN

Re: meh

I looked at my records and no where did I say anything about the network in West Virginia. Simmer down now....
cyper2002

join:2005-02-19
Philippi, WV
I'm from WV and agree that coverage is very good here. It's also nice to see them expanding 3g across our state. The thing that bothers me about the iPhone being locked into Att is that there coverage leaves out entire towns in other states and CDMA is pretty much everywhere.

Who's The Boss?

"Mr. Stephenson also is seeking to overhaul AT&T's marketing to make wireless the priority. The next step, he said, is to do away with a requirement that customers have AT&T's home-phone service to qualify for discounts on TV or broadband Internet services. Being a wireless customer should be enough, he said."
Okay, you're the CEO, why haven't you done that alreaedy? I got a world of pushback from snooty BellSouth types when I signed up for dry-line service. "You don't get any discounts without a phone line," was the common sneer.

Do these people work for you, or do you work for them?
gopnick

join:2005-01-07
Benton, AR

D'oh!

I sure hope Verizon makes a good counter-offer to Apple. I desperately want to switch to Verizon. This AT&T 3G service is just awful (it used to be better).

jimmybean

@sprintlink.net

Bad move for Apple

Apple would be able to double the number of iPhones sold if it wasn't exclusive with ATT. Time to move on Apple - it was good while it lasted but now it's time to shoot for true penetration in the marketplace by moving to all carriers.

But i can't blame ATT. 60% of their net adds in 4Q08 came from the iPhone. I'd be offering the world to keep it as well if I was them.

The Beer
I Love It When A Plan Comes Together
Premium
join:2001-07-24
Atlantic, IA

NOOOOOOO

The only reason I do not own a iphone is because AT&T exclusive, I not just want to have it I want it to work with more bars in ALL places like a CDMA phone will.

aaronwt
Premium
join:2004-11-07
Woodbridge, VA

Re: NOOOOOOO

I won't consider an iPhone until Verizon offers it. Since I will not be changing cell carriers.

cableties
Premium
join:2005-01-27

Re: NOOOOOOO

I hear ya, however I fear Verizon will nickel-dime out all the features of the phone (and want control of more $ from iApps...I mean it does cut into their music stuff...)
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fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: NOOOOOOO

Since apple is the one calling most of the shots, I doubt Verizon will be able to do that, which is part of the reason why Verizon didn't get the phone in the first place. Apple wants their phones sold and handled in a certain way, or you can't have it. To be honest, that's a good thing, for once, that apple does.
gateguy
Premium
join:2001-02-12
Reisterstown, MD
Seconded!

Transmaster
Don't Blame Me I Voted For Bill and Opus

join:2001-06-20
Cheyenne, WY
Reviews:
·CenturyLink

The House of Apple's our way or the Highway....

business model is showing some rips in the fabric. They tried this approach with the iPhone in Japan and they where shown the door. I understand there is a 4G iPhone in the works with a camera, and the other things demanded by the Japanese consumer. I love my iPod Touch, but as a cell phone, for me, it would suck. The shape is all wrong, no camera, and no physical Keyboard. The have Blackberries that have all of this, and a nice touch screen for a whole bunch cheaper in price, and a bunch of cell phone companies waiting to business whit you.
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Count Zero
Obama-Biden 2012
Premium
join:2007-01-18
Winston Salem, NC

Re: The House of Apple's our way or the Highway....

You do realize the iPhone does have a camera right?

As for the lack of a tangible keyboard - so? If you add a tangible keyboard you either give up screen size or device size. And the on screen keyboard has worked very nicely IMHO.

And what blackberry has a keyboard, screen the size of the iPhone in a package this slim & sexy with 8GB of included memory for $199 and $30/mo for unlimited data?
ravensfan55

join:2008-06-16
Severna Park, MD

iPhone is AT&T's cash cow

So what if they want to keep it? Even after Apple gets their slice the iPhone is AT&T's most profitable device.

atuarre
Here come the drums
Premium
join:2004-02-14
College Station, TX

RE

Erm, bear in mind that I believe the understanding of how this works is, Apple gets a percentage of the wireless revenue, plus the cost of the devices. Don't quote me for sure, but I believe that is how it works. If it were me, and Apple came to me with their "iPhone", I would tell them to shove it. I doubt every carrier will want the iPhone unless this "revenue sharing" was not part of the deal. LG and Samsung don't get a percentage of Verizon or AT&T's revenue. Apple is the only company that does this.

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