Apple Makes $831 On Each AT&T iPhone

[j__1]

Er, is this where this article should go? :)


Anyho, these numbers sound about right... or at least they're in the ballpark. That is a decent amount of icing, eh? ;)

Apple Makes $831 On Each AT&T iPhone

Posted by kdawson on Sunday October 28, @02:46PM
from the minting-it dept.
http://images.slashdot.org/topics/topicmoney.gif (http://apple.slashdot.org/search.pl?tid=98) http://images.slashdot.org/topics/topiccommunications.gif (http://apple.slashdot.org/search.pl?tid=215) http://images.slashdot.org/topics/topicapple.gif (http://apple.slashdot.org/search.pl?tid=3)
Ponca City, We Love You (http://poncacityweloveyou.com/) writes "The NYTimes reports that Gene Munster, an analyst at Piper Jaffray, has studied Apple's financial statements and come to the conclusion that AT&T is paying Apple $18 a month (http://bits.blogs.nytimes.com/2007/10/25/the-831-iphone/), on average, for each iPhone sold by Apple and activated on AT&T's network — up to $432 over a two-year contract. This shows how much incentive Apple has to maintain its exclusive deal with AT&T rather than to sell unlocked phones or cut deals with multiple carriers. Last week Apple disclosed that 250,000 iPhones had been purchased but not registered with ATT that Apple thinks are being unlocked so Apple has now taken action to curb unauthorized resellers by limiting sales of the iPhone to two per customer (http://www.news.com/8301-13579_3-9805887-37.html?tag=nefd.blgs) and requiring that purchases must now be made with a credit or debit card — cash will not be accepted." The latter article links to a US Treasury page (http://www.treas.gov/education/faq/currency/legal-tender.shtml) explaining the incorrectness of the widely-held belief that cash cannot be refused for any transaction.

[Ellen]

WOW, this amount of money could put the icing on just about every cake in the US, when you add up the cost of all the people who purchased them!! I knew they were making a big profit off of the sales, but had no idea that it was this much.

J__1, I moved this post to the AT&T forum where it will get better exposure. Thanks for the info . :)

[j__1]

WOW, this amount of money could put the icing on just about every cake in the US, when you add up the cost of all the people who purchased them!! I knew they were making a big profit off of the sales, but had no idea that it was this much.Yeah, that's what funny about telecom... or any service provider for that matter (e.g., natural gas, electricity).

Even in terms of a basis point, if we're talking about calls to care, attachment rate, or churn... even a relatively small change can lead to ginormous figures!

[gapboi954]

lol... apple is making out like a bandit

[jgebis]

The good news about that is hopefully the potential for huge profits will drive other companies to make similar (or better!) products... eventually, other phones will get better, and cheaper, and it will work out better for consumers.

[kinjutsu11]

2 things.
1) Apple is making even more money off their International carrier partners, like O2, they are going to be taking so much money out of their contracts, compared to ATT it's a joke.
2) Other manufacturers may want to start doing the same thing with some of their handsets, as Apple is doing something no other manufacturer has done.

One thing is for sure, we are on the verge of another huge change in the wireless indsutry. What with Google launching something shortly, maybe even on Monday, and with Apple's new tactics to the wireless arena, 2008 will be an interesting year for wireless.

[Rzrlvr74]

And you wonder why AT&T and Apple were all bent out of shape over the unlocked iphones. For AT&T it means that they are being charged for phones that are being used on other networks. For Apple, if this "virtually hack-proof" unit could be unlocked and used elsewhere, AT&T could cry breach of contract and quit paying Apple. It was a lose-lose situation for all if left uncorrected. Unfortunately the consumers lost out largely in this monopoly.

[Baumann]

Apple is robbing people, really.

[semaj]

amount seems a bit high to me

[Fred333]

If those numbers are right then I would have to say wow!

[j__1]

Apple is robbing people, really.The game, is the game, is the game... Jobs is a tricky bastard, eh? :)

[j__1]

amount seems a bit high to me
Most certainly... but they are getting something. The fruit is splitting the game like they did with the music industry.

I would call this the max... what's the min? I left my crystal ball in Bellevue...;)

[cwilliams706]

Er, is this where this article should go? :)


Anyho, these numbers sound about right... or at least they're in the ballpark. That is a decent amount of icing, eh? ;)

That's crazy considering it's on EACH individual iPhone, but that's the cost you pay if you want to be an exclusive carrier. I can only imagine how much AT&T will be handing over when Apple released the 3G version of the iPhone in either Q2 or Q3 2008.