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U.S. Cellular Says 'No Thanks' to iPhone
Apple Terms 'Unacceptable,' Deal Risky
by Karl Bode 04:18PM Tuesday Nov 08 2011
While Sprint and C Spire (formerly Cellular South) just paid hefty sums to join the iPhone party, U.S. Cellular says they turned down an offer from Apple to carry the device. Speaking about the device on the company's third-quarter earnings call, company CEO Mary Dillon said that U.S. Cellular considered adding the iPhone to its lineup, but that Apple's "terms were unacceptable from a risk and profitability standpoint." Dillon didn't give specifics, but Sprint is rumored to have agreed to pay around $20 billion for 30.5 million iPhones over the next four years, a deal that won't be cash positive for them until 2014. U.S. Cellular also noted they will offer LTE to 25% of their network by the end of the year, with LTE devices appearing in the first quarter of 2012.

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thegeek
Premium
join:2008-02-21
right here
kudos:2

Taking a Nap Karl?

This is old news.

jay608
Going Nucking Futs

join:2007-01-22
Chicago, IL

Was in

The Friday evening links.

mod_wastrel
iamwhatiam

join:2008-03-28
kudos:1

Re: Was in

which explains why I would have missed seeing it.
amungus
Premium
join:2004-11-26
America

I'm OK with that

As a customer, I'm actually fine with that decision.

Don't really care that much about the iPhone, and am glad that they'd rather continue to focus on other things.

FFH
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Re: I'm OK with that

said by amungus:

As a customer, I'm actually fine with that decision.

Don't really care that much about the iPhone, and am glad that they'd rather continue to focus on other things.

As a Sprint customer I was appalled at the deal that Sprint signed with Apple. I don't think they will ever recoup what they paid to get the iPhone and pick up new customers. I think that U.S. Cellular made the right call. Apple demands too much, yet the companies, and therefore their customers, pay to get the iPhone anyway.
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»www.politico.com/rss/2012-election.xml
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Dest
Bolo
Premium
join:2000-03-21
Naperville, IL

Re: I'm OK with that

I was not happy with the amount of changes they had to do to make the iphone happen, I was finally going to qualify for the premier annual upgrade and thanks to the iPhone that's no longer possible.
puck0114

join:2005-12-24
Portland, OR

Re: I'm OK with that

Exactly. Many of the reasons I chose Sprint as a carrier are gone (their Premiere programs being a big one). If they get rid of their unlimited data or introduce any egregious price hikes, I'll jump ship.

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1
said by FFH:

As a Sprint customer I was appalled at the deal that Sprint signed with Apple. I don't think they will ever recoup what they paid to get the iPhone and pick up new customers. I think that U.S. Cellular made the right call. Apple demands too much, yet the companies, and therefore their customers, pay to get the iPhone anyway.

Are you serious?

The iPhone would save T-Mobile from the abyss if it was offered. Yes, it would.

As for Sprint... It was going to have a slow decline into irrelevance without the iPhone. At least they're on a level playing field now with the other carriers in terms of device offerings. Sprint will pay off their debt eventually...

U.S. Cellular will experience a similar slow decline as customers can now leave to get an iPhone on not one, not two, not three, but four carriers if you count C Spire.

In fact, I think Sprint stock is an absolute steal right now if you have any faith in the long term viability of the company.
--
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Selenia
I love Debian
Premium
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Fort Smith, AR
kudos:2

2 edits

Re: I'm OK with that

An unlocked iphone can do EDGE on T-Mobile. If you often use wifi, it's good enough when using efficient apps for most on the go tasks. Besides, EDGE still has notably better voice quality, especially on AT&T. No congestion issues here on 3G, as I get less than 100 ms pings to west coast and 3-7 mbits down and 1-2 up on my Android. Still EDGE has better voice quality, even on an iphone I tested. Saves battery, too.
--
A fool thinks they know everything.

A wise person knows enough to know they couldn't possibly know everything.

There are zealots for every OS, like every religion. They do not represent the majority of users for either.
sparc

join:2006-05-06
said by IPPlanMan:

The iPhone would save T-Mobile from the abyss if it was offered. Yes, it would.

I don't think it's that easy to say iphone is a sure win for the smaller carriers.

When you have a hundred million customers like AT&T and Verizon, it's far easier to take these gambles. When you are much smaller like Sprint and T-mobile USA, betting the farm on one phone is hugely risky. Those problems only get worse the smaller you get as Apple will probably only cut deals when there is some sort of guaranteed volume. We're not just talking about a few hundred million dollars here. Apple is asking for tens of billions.
iFail 5G

join:2011-08-03

2 recommendations

said by IPPlanMan:

said by FFH:

As a Sprint customer I was appalled at the deal that Sprint signed with Apple. I don't think they will ever recoup what they paid to get the iPhone and pick up new customers. I think that U.S. Cellular made the right call. Apple demands too much, yet the companies, and therefore their customers, pay to get the iPhone anyway.

Are you serious?

The iPhone would save T-Mobile from the abyss if it was offered. Yes, it would.

As for Sprint... It was going to have a slow decline into irrelevance without the iPhone. At least they're on a level playing field now with the other carriers in terms of device offerings. Sprint will pay off their debt eventually...

U.S. Cellular will experience a similar slow decline as customers can now leave to get an iPhone on not one, not two, not three, but four carriers if you count C Spire.

In fact, I think Sprint stock is an absolute steal right now if you have any faith in the long term viability of the company.

The iPhone isn't anyone's savior except maybe AT&T pre 2010. Its not some magical device that will pull a failing company back up. In fact all the money Sprint has had to spend on the iPhone has left them with NO money for network expansion and they are having to borrow more. They said the iPhone won't even allow them to break even till 2015. Well guess what? They have one of the WORST performing network today! They should have fixed their network instead of scamming users into a new contract and allowing their network to degrade even further.

Before Verizon got the iPhone they were still doing fantastic. And now that there are much much better phones on the market than the iPhone it isn't beneficial for the carriers to waste money they don't have in something like the iPhone.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

As an AT&T customer, I'm glad Verizon got the iPhone so that AT&T had to up the ante on the Android side, but I almost wish that Big Red had turned down the iPhone, as it would have helped Android out in the long run, and I don't think it would have hurt Verizon in the least bit. Probably helped them on the network capacity end with LTE, although it would have slowed the ARPU growth from smartphone adoption a bit.

Sprint is a non-player in the contract world. The only place they are a player is in the prepaid, which has been somewhat disruptive, and maybe more so now with Republic Wireless.

Sprint is really taking the wrong approach, IMHO. They are dropping billions on the iPhone and LTE, when they desperately need some more CDMA coverage, and they need to focus on prepaid, which isn't LTE dependent, since at this point, that's all they've got. Their postpaid is a joke, and it will be continue to be so until they offer disruptive pricing. $5 less than AT&T or Verizon isn't exactly disruptive.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

As an AT&T customer, I'm glad Verizon got the iPhone so that AT&T had to up the ante on the Android side, but I almost wish that Big Red had turned down the iPhone, as it would have helped Android out in the long run, and I don't think it would have hurt Verizon in the least bit. Probably helped them on the network capacity end with LTE, although it would have slowed the ARPU growth from smartphone adoption a bit.

Sprint is a non-player in the contract world. The only place they are a player is in the prepaid, which has been somewhat disruptive, and maybe more so now with Republic Wireless.

Sprint is really taking the wrong approach, IMHO. They are dropping billions on the iPhone and LTE, when they desperately need some more CDMA coverage, and they need to focus on prepaid, which isn't LTE dependent, since at this point, that's all they've got. Their postpaid is a joke, and it will be continue to be so until they offer disruptive pricing. $5 less than AT&T or Verizon isn't exactly disruptive.

As an AT&T customer as well, I would have to agree it was good for Verizon to get the iPhone. I am glad Verizon hasn't forgotten Android, they still push Droid's as their predominate and best performing handset.

Up until Verizon got the iPhone, AT&T was only getting a few decent Android's like the Captivate. The rest were either unlocked or complete crap. I just got the HSPA+ 21/LTE HTC Vivid and its fantastic. I highly doubt I would have this handset without Verizon coming into the picture.

Sprint should have first finished Co-Locating their CDMA network with their iDEN site's and shut off redundant sites to save money on space and backhaul. They have the most cell sites out of ANY wireless carrier in the US, yet have the worst native coverage.

In all honesty they haven't completed their merger with Nextel yet. Their brand spells out inconsistency with every handset that goes out the door. Not sure how it is possible to have one handset on the same company have great results (iDEN), but a different handset (CDMA) fail miserably when you go indoors or in more rural areas and flop to roaming. AT&T/Cingular and VZW operated two to three networks at the same time, and instead of the crappy Hybrid handsets Sprint once again failed at, they had dual mode and tri mode handsets that actually worked. Cingular had AMPS/TDMA/GSM, but in the QUICK transition period customers were allowed to purchase GAIT handsets. Same for Verizon, they ran their AMPS network along with 1xRTT but handsets essentially seamlessly roamed between the two until an all digital network could be established.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

Yeah, I'm still a little jealous that Verizon has had a lock on almost all the really good Android devices, with the exception of SGS II, although that was Samsung. Verizon has been leading in Android since day 1 with DROID, then DROID 2, DROID 2 Global, DROID 3, DROID Bionic, and now Razr, HTC Rezound, and Galaxy Nexus.

Yeah, it's still weird that iDen has some sites that CDMA isn't on. I think the ultimate thing with iDen though is that they don't want to integrate it with CDMA, since it is going away, and they don't want to necessarily build co-located CDMA sites with the iDen sites when the CDMA sites can take over the tower space from iDen in a couple of years.

Wait... they have the MOST cell sites? HOW? That's atrocious.

iDen just really needs to go, and Sprint needs to expand their native CDMA coverage. Sure, they will never be Verizon's blanket, but they need to add some meat to the skeleton, and they also need to go 100% 3G... why are there some areas left on 1xRTT?

Sprint needs to recognize that they have nothing to offer as a postpaid carrier and should focus on prepaid, or disruptive postpaid pricing.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

Yeah, I'm still a little jealous that Verizon has had a lock on almost all the really good Android devices, with the exception of SGS II, although that was Samsung. Verizon has been leading in Android since day 1 with DROID, then DROID 2, DROID 2 Global, DROID 3, DROID Bionic, and now Razr, HTC Rezound, and Galaxy Nexus.

Yeah, it's still weird that iDen has some sites that CDMA isn't on. I think the ultimate thing with iDen though is that they don't want to integrate it with CDMA, since it is going away, and they don't want to necessarily build co-located CDMA sites with the iDen sites when the CDMA sites can take over the tower space from iDen in a couple of years.

Wait... they have the MOST cell sites? HOW? That's atrocious.

iDen just really needs to go, and Sprint needs to expand their native CDMA coverage. Sure, they will never be Verizon's blanket, but they need to add some meat to the skeleton, and they also need to go 100% 3G... why are there some areas left on 1xRTT?

Sprint needs to recognize that they have nothing to offer as a postpaid carrier and should focus on prepaid, or disruptive postpaid pricing.

Yea Sprint has some 75,000 ish sites, where AT&T has only about 55k.

They should have co-located the first year of the merger, all that would have taken to complete is to remove one 1 iDEN panel, and replace it with a 1xEVDO panel. And then delete redundant sites that aren't needed.

iDEN actually is their most reliable technology, and used to bring in the highest ARPU compared to Sprint PCS as many of their customers were Gov. and contractors.

Now Sprint is shutting down the iDEN network without having the same coverage AND losing the only decent PTT system over cellular this country has.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

iDen is a dead technology. It can't even handle texting, must less data. In a world where voice is tertiary to data and texting, it is a dinosaur. PTT is available on Android and iPhone, since once you have data, you can do anything you want with it. Everything is easily convertible into packet data.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

iDen is a dead technology. It can't even handle texting, must less data. In a world where voice is tertiary to data and texting, it is a dinosaur. PTT is available on Android and iPhone, since once you have data, you can do anything you want with it. Everything is easily convertible into packet data.

Heh, I can see you obviously haven't ever had a use for real PTT. PTT on iPhone and Android is complete BS.

iDEN can actually handle SMS just fine over the paging channel, but unfortunately Sprint was too stupid to enable it until just this year.

iDEN may be dead in the average person's eye's but it's not dead for public safety and corporate. Sorry but PS officials don't need use 3G to coordinate and setup a perimeter or dispatch officers off site and off the public transmission bands.

Further more, even the most reliable PTT software designed for quick communication is still not nearly as reliable as iDEN.

When CDMA, LTE, or GSM, cell sites can fall back to being a basic repeater and fall off the grid, not relying on the VERY vulnerable PSTN network, then we will have something to talk about. But now Sprint's 3G is so unreliable, they may have to postpone shutting down iDEN until they can guarantee their contract iDEN sub's a good solution.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

BTW, I'm GSMinCT on Hofo. So we've definitely already had this discussion.

If people need two-way radios, then use two-way radios, not a cellular network. If they need a cellular network, use a cellular network. iDen was an awful conglomeration of the two that people obnoxiously used to avoid paying for more minutes. iDen is dead. Sprint is also developing a replacement for iDen that runs on CDMA/EVDO.

Also, even if you don't like the way iPhone/Android PTT works, the beauty of running on an software IP platform, is if you don't like the apps out there, write one yourself! Even if there are multiple incompatible systems on iPhone and Android, just have multiple apps. No big deal. Much better than baking it into the hardware, as it was never universal like the PSTN is.

Why should they have to guarantee their iDen subs a reliable CDMA network? Just let them out of contract, if they want to switch to Verizon, they will. The fact that there are still contract iDen customers is appalling, apparently they are stuck in 2005 and can't get out. All I've ever seen on iDen in the past couple of years are really crappy Boost phones, and those are few and far between. Even Boost is mostly switched to CDMA.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

BTW, I'm GSMinCT on Hofo. So we've definitely already had this discussion.

If people need two-way radios, then use two-way radios, not a cellular network. If they need a cellular network, use a cellular network. iDen was an awful conglomeration of the two that people obnoxiously used to avoid paying for more minutes. iDen is dead. Sprint is also developing a replacement for iDen that runs on CDMA/EVDO.

Also, even if you don't like the way iPhone/Android PTT works, the beauty of running on an software IP platform, is if you don't like the apps out there, write one yourself! Even if there are multiple incompatible systems on iPhone and Android, just have multiple apps. No big deal. Much better than baking it into the hardware, as it was never universal like the PSTN is.

Why should they have to guarantee their iDen subs a reliable CDMA network? Just let them out of contract, if they want to switch to Verizon, they will. The fact that there are still contract iDen customers is appalling, apparently they are stuck in 2005 and can't get out. All I've ever seen on iDen in the past couple of years are really crappy Boost phones, and those are few and far between. Even Boost is mostly switched to CDMA.

And like I said, you aren't the one out there saving people's lives so you really wouldn't know.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

If people are actually relying on iDen to save lives, I'm a little scared. They should have real radio networks, and if they legitimately need a backup to radio systems, I'm hoping they have Verizon if, god forbid, I ever need help.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

If people are actually relying on iDen to save lives, I'm a little scared. They should have real radio networks, and if they legitimately need a backup to radio systems, I'm hoping they have Verizon if, god forbid, I ever need help.

Like I said, you obviously aren't in public safety.

Selenia
I love Debian
Premium
join:2006-09-22
Fort Smith, AR
kudos:2

Re: I'm OK with that

said by iFail 5G:

said by BiggA:

If people are actually relying on iDen to save lives, I'm a little scared. They should have real radio networks, and if they legitimately need a backup to radio systems, I'm hoping they have Verizon if, god forbid, I ever need help.

Like I said, you obviously aren't in public safety.

Enlighten us then. Why in the world would they rely on a private cell network, rather than use their own radio system built to withstand outages on networks run on a national scale? I know the police, fire, and ambulance all use radio systems here. They have public repeaters that broadcast on frequencies listed for scanners. I am sure they use digital transmissions for what they wouldn't want us to hear. Given Sprint's performance here, I would not rely on Sprint to save my life! Scary thought!! lol.
--
A fool thinks they know everything.

A wise person knows enough to know they couldn't possibly know everything.

There are zealots for every OS, like every religion. They do not represent the majority of users for either.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by Selenia:

said by iFail 5G:

said by BiggA:

If people are actually relying on iDen to save lives, I'm a little scared. They should have real radio networks, and if they legitimately need a backup to radio systems, I'm hoping they have Verizon if, god forbid, I ever need help.

Like I said, you obviously aren't in public safety.

Enlighten us then. Why in the world would they rely on a private cell network, rather than use their own radio system built to withstand outages on networks run on a national scale? I know the police, fire, and ambulance all use radio systems here. They have public repeaters that broadcast on frequencies listed for scanners. I am sure they use digital transmissions for what they wouldn't want us to hear. Given Sprint's performance here, I would not rely on Sprint to save my life! Scary thought!! lol.

You wouldn't rely on it for main dispatching, but you would use it for quick in field coordination and contact back with command post or dispatch. Lets say you were doing a field sting operation and need direct contact with your commanding officer, or you need direct contact with a select group all at once, private and instant communication is very valuable and much quicker than picking up a phone and calling.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

Then get a radio system that handles it. Or develop an app for that. On Verizon.
iFail 5G

join:2011-08-03

Re: I'm OK with that

said by BiggA:

Then get a radio system that handles it. Or develop an app for that. On Verizon.

Why Verizon? Their cell sites CAN'T fall back to being basic repeaters. Not sure whats hard to see about the fact it still rely's on the PSTN network which goes down pretty easy. iDEN was one of the first up and stayed up in some areas during Katrina.
BiggA

join:2005-11-23
EARTH

Re: I'm OK with that

Maybe AT&T, but my point is, do it on a network that's reliable. You're also saying it's for secondary communication, so their own radio systems should be the ones up and running if regular communication lines are down, not relying on Sprint's ancient Nextel network that by some miracle hasn't just stopped working yet.

True public safety users should have their own networks, and beyond that, relying on a third party network to work is nuts. For local communications among individuals or small organizations, there's GMRS, for longer range there's ham radio and other systems which don't require any infrastructure and power to work. Also, if you have one isolated tower acting as a repeater, that's not much more useful than a bunch of GMRS or eXRS radios, as those go a few miles, about the same as a single cell site anyways.

If your biggest worry is communication among the general population, well, they're mostly not rocking old iDen flip phones. Most of them are rocking DROIDs and iPhones anyways, so maybe a smarter thing to look at would be why the towers couldn't get any backhaul access after Katrina, and how the network in disaster-prone areas (including recently in CT where 200 towers went out during Snowtober) could have better back-up systems for basic levels of functionality.

Selenia
I love Debian
Premium
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Fort Smith, AR
kudos:2
People used to use those PTT phones in public at max volume, including supermarkets, malls, etc. Good riddance for the abolition of one of the most annoying inventions known to man. I used to want to take away those handsets and relentlessly clobber the user with it! Much more annoying than iphone fanbois on their bluetooth. They just look crazy, that's all. But to get a few PTT phones in the same room blaring, especially when trying to focus on something, is just maddening. Used to get contractors using those at my place of work. Had to compel them to shut them off...and I wasn't always nice about it!! I mean who the hell would walk into someones office with their scanner blaring? The effect with these phones was much the same.
--
A fool thinks they know everything.

A wise person knows enough to know they couldn't possibly know everything.

There are zealots for every OS, like every religion. They do not represent the majority of users for either.

Thaler
Premium
join:2004-02-02
Los Angeles, CA
kudos:3

1 recommendation

Meh, damned if you do, damned if you don't.

• Sprint didn't pick up iPhone, continues to bleed customers for not having the "it" shiney to bring to the table.
• Sprint picks up the iPhone, but enters into a contract that won't see profit for several years.

While I'd love for a cell network to simply invest in their cell network, customer & sale trends don't lie - we love access to tech toys a lot more than we love being able to use them.

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1

So why did C Spire say yes to it?

Why did C Spire agree to offer the iPhone? Does it have deeper pockets than U.S. Cellular does?

I wouldn't expect U.S. Cellular to get a better deal than they were already offered... I'll bet they come back to the table eventually.

morbo
Complete Your Transaction

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Re: So why did C Spire say yes to it?

said by IPPlanMan:

I'll bet they come back to the table eventually.

I agree they will come back to the table...when the price makes sense for them to do so. iPhone is still huge but is slowly becoming less of the default smartphone and more the expensive smart phone option.

IPPlanMan
Holy Cable Modem Batman

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kudos:1

Re: So why did C Spire say yes to it?

said by morbo:

said by IPPlanMan:

I'll bet they come back to the table eventually.

I agree they will come back to the table...when the price makes sense for them to do so. iPhone is still huge but is slowly becoming less of the default smartphone and more the expensive smart phone option.

More expensive for customers?
Have you seen the free one (3GS)?
Have you seen the 99 dollar one (iPhone 4 8GB)?

How much should it be?
--
"We're going to start at one end of (Fallujah), and we're not going to stop until we get to the other. If there's anybody left when that happens, we're going to turn around and we're going to go back and finish it."
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•••

ArgMeMatey

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said by morbo:

said by IPPlanMan:

I'll bet they come back to the table eventually.

I agree they will come back to the table...when the price makes sense for them to do so. iPhone is still huge but is slowly becoming less of the default smartphone and more the expensive smart phone option.

USCC's market share will continue its current decline. At the same time, Apple stockholders will want Apple to be out cutting new deals to keep profits up.

The question is, "When USCC decides to pursue this again, will they have enough volume and leverage to get a reasonable deal from Apple?"

It's something like a network effect, where the iPhone/iTunes/iCloud/iWhatever is the network, and simultaneously a barrier to entry for USCC.
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swintec
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U.S. cellular

I helped my girlfriend move to them after she was dumped by T-Mobile for excessive roaming. US Celluar is a great company but their devices are very lack luster. There 2 "top end" phones leave a lot to be desired to me, but I suppose they are fine for the average cell user.
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•••

Paulster

@rcn.com

U.S. Cellular Says 'No Thanks' to iPhone

Its called the i pay phone

dewiz88

@rr.com

I phone

Well............I don't blame them for not wanting to pay all that money ...that's rediculous ..but, i sure wanted an I phone. My friends mostly all of them, have one, and it's awesome. I hate my wanna be Samsung. Complicated, troublesome.....can't even answer the phone when i want. It bites to be honest. But I love Us Cellular's customer service. I have had 3 and Att comes close but their coverage sucks. So i will remain true to us Cellular.
jimmyjj

join:2011-11-14

I think it's foolish if the carrier's don't offer the iPhone

Although the sprint deal sounds incredibly one sided in Apple's Favor, the math breaks down like this. 20 billion dollars divided by 30.5 million = $655.74 per phone. Assuming an iPhone sells for $200. The net outlay is $455.74 divided by a 24 month contract and the monthly subsidy averages out to $18.99/month.

The least expensive iPhone bill with unlimited texting is just under $90/month. So the bottom line isn't bad at all for Sprint or the other carriers for that matter. 30.5 million phones over 4 years is just under 8 million iPhones a year.

Based on the sales figures of AT&T and Verizon, Sprint can take a calculated risk on how many they should be able to sell. (the figures don't account for the higher end iPhones or higher end plans so the actual numbers are in Sprint's favor)

Since most phones are subsidized by about $300 by the cellular carriers anyway, the difference that a carrier must subsidize the iPhone is negligible compared to the sales increase they will see.

In my opinion, it's foolish that a cellular carrier doesn't carry the iPhone if given the opportunity.