In the past few days, we have written a lot about the Verizon-Apple relationship and whether or not the two companies will partner.
Now in the scenario of the two companies actually partnering, what will become of the AT&T-Apple partnership?
According to a note to investors from Broadpoint.Amtech's analyst Brian Marshall, this new partnership between Apple and Verizon is very likely to happen and could consequently lead to the reduction in the subsidy offered by AT&T to its customers. Currently, the subsidy stands at close to $450. However, with a non-exclusive carrier rights in place, this subsidy might come down to $300 which means that the customer must pay an additional $150 upfront to buy an iPhone.
Despite the rise in prices, Brian sees an increase in the volume of iPhones sold due to the new partnership with Verizon. He estimates an approximate 14 million iPhones to be sold by Verizon in 2011 that could see Apple earn as much as $7 billion in revenues.
Though Brian is right in his assessment that a non-exclusive partnership is likely to reduce subsidies and hence increase the product prices, it does not completely portray the ground realities. Opening up the network to include Verizon itself is likely to impact the revenues of AT&T highly considering the fact that over 90% of the company's post-paid subscriber growth is just from the sale of iPhones. With such a heavy reliance over the sale of iPhones, it is unlikely that the AT&T management would agree to increase the price of the iPhones, which will reduce their target audience.
Also, with frequent negative press about the low quality of service, AT&T cannot play on value and has to play plainly upon volumes in order to acquire and retain customers - something that Verizon shall be less worried about. A likely scenario would then be an option for new customers to either go for a lower priced iPhone with AT&T contract or a higher priced handset with Verizon. Geographical factors could also come at play with AT&T likely to raise the price of the iPhone in regions where their network is at par or better with Verizon's network quality.
I think AT&T will definitely play the pricing game whenever its iPhone exclusivity ends and would be in a better position by that time in terms of network coverage and performance as they're working hard to address the issues caused by the surge in data usage since the launch of the iPhone.
A lot of our readers had expressed a desire to move to Verizon in our earlier post on this topic. In a hypothetical scenario of differential pricing where iPhone customers might be required to shell out more money for a Verizon powered handset, would you be still willing to go with Verizon? Please tell us in the comments.
[via AppleInsider]
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Crappy service with a cheap iphone or amazing service with an expensive iphone + higher monthly payments?
As much as i hate AT&T's bad reception, Im gonna have to stick with it because Verizion is pretty dang expensive. The real question is why is AT&T's so terrible and why dont they fix it?!?
OOOOh a 4G network. Plus it has to better than a monopoly of exclusivity. More returns for the next stock split by Apple Inc. as their customer base is increased!
I would rather go with tmobile, i hope tmobile will get the iphone in the US they already have it in the UK.
If all that said comes true, which I think will, I'm going to end up sticking with AT&T. More people on Verizon= less on AT&T. Less on AT&T = better service. HOPEFULLY. Plus AT&T needs to show us what they have spent all those revenues generated from the iPhone, it seems like they're not doing much AND probably should start when Verizon gets a piece of this deal.
Being second to get the iphone, i hope Verizon learned from AT&T mistakes. I don't think it will be a repeat since Verizon's network is a lot better prepared to start off with compared to AT&T's three years ago.
Being someone who travels by car cross country multiple times per year, the coverage area is far better with Verizon than AT&T. AT&T coverage is limited to pretty much the large urban areas, as soon as you get a short distance from these large areas you are lucky to get even enough signal to make a phone call, while with Verizon there appears to be very few areas where Verizon doesn't have data coverage. AT&T wireless is supported by the iphone revenue but AT&T doesn't seem willing to be add any infrastructure to add to their coverage voids.
So would I pay more for an iphone on Verizon? YES!!!
Verizon has a lot more 3G coverage. But if you use yor cells data netwok often you could get into trouble. Verzon only allows 5gb of data usage per month. AT&T is still unlimited. I'll stick with AT&T for now.
Verizon has a lot more 3G coverage. But if you use yor cells data netwok often you could get into trouble. Verzon only allows 5gb of data usage per month. AT&T is still unlimited. I'll stick with AT&T for now.
Hear in puerto rico at&t has the best coverage , speed , phones and 3G in almost all the island since verizon is now claro the only thing that bugs me is that wen inside a building the signal goes to zero
Look what Verizon does to the rest of the phones they have ie, crippling features on the device that you own> What would they do to the IPHONE? I dont think that I would like to turn on my IPHONE and see that gorgeous screen all red!
Verizon is still analog, you can only use your iphone to them….most of the world is GSM, even the third world….AT&T will upgrade their network, easily…..but changing from ANALOG to GSM is more work….let see about that
I can't comment a whole lot about network strength, although where I live and work the signals are great, but last year on vacation we went to Jekyll Island, a tiny island in the Atlantic off the coast of Ga. Everybody else had Verizon, they were all on a family plan, and I had AT&T. I was the only one to have reliable service. Half the time the others couldn't even make a call yet I had 3-5 bars at all times.
have verizon and at&t in the area i think i will go with at&t, once you have millions of iphone on Verizon service then there service will get buggy and slow just like AT&T verizons infrastructure isnt what everyone thinks it is. They dont realize the amount of data and bandwidth iPhone users user. I know Im on the internet all the time with mine so I know Im using a lot so I will stay put. if I could get the data cost down to 10 bucks a month I would be happier
ATT is horrible around where I live. No 3g… maybe 2 bars at any given time etc. Meanwhile, everyone I know on verizon/sprint is at full power.
AT&T only owns rights to about 60% of the country coverage that's why there is very little coverage in some areas around the country. AT&T is in fact in the top 200 markets throughout the United States and nearly all of those with 3G coverage! That's pretty darn good. I'm sure that Apple will tend to go with Verizon being that it could make more money but I have no idea why Verizon would put out negative ads about the iPhone. I mean really? Your trying to work out deals with Apple and you make an adroid add that completely rips it? I don't see the point in that.
How can you compare ATT and verizons iphone plans if only 1 of the providers offer the iphone?
exactly what i was about to post…
its funny how ppl keep complaining about at&t… because ive never had any problems. At&t has been the best service ive had. and ive had sprint, verizon, tmobile and the last 5 years with att. here in PR At&t is the bestest when it comes to coverage and speeds. Like phc78 said, verizon = claro (same service, different name) which literally sucks, and i work with Tmobile and they dont even have 3g yet… hopefully soon.
whatever apple does or does not with verizon, i dont care. ill stick with att for the time being.
I'm sticking with AT&T.
" I've got one that can see !!! "
+theyliveandwesleep.com+
I think it depends on where your at, i live in Tampa, fl and never had a problem with AT&T 3g. Now i dont do much traveling so it woudnt be in my best interest to switch, but If verizon eventually does get the iphone, im sure AT&T will have to do something about there plan prices, for it would be the only reason why people would stay instead of switching. If the price different is that significant that is…..
AT&T data cap is 5 gigs a month.
…not unlimited.
When I first got my iPhone 3G in October 2008, the AT&T folks promised that a 3G network was to be installed the following January in my area. In July I upgraded to a 3GS and was told by a Best Buy rep that a 3G network would be coming soon. When I called AT&T's service center in august to inquire about the 3G network progress I was told they had no immediate plans to install one in my area and after mentioning the word "unlock" I was promptly given a $10/month discount on the $30 data plan as compensation.
My bottom line: my iPhone is never more than an arms length away from me, but AT&T's customer service and lack of expansion has me considering dumping my iPhone in favor of whatever iPhone lookalike Verizon has coming out next. News of iPhone possibly sharing carriers makes me feel like Christmas has come early!
Dears
I jail broken my iPhone 3G on OS 3.0 and now after some days it is not locating WiFi networks.
Can anyone help?
regards,
The iphone is a goliath and I have the 3gs. I had the storm with Verizon and the lack of support that RIM had for that product pissed me owwwffffff! So, I went to At&t. The dropped calls that I have had to endure are painfull and annoying. Try having a business conversation with your artist and you keep having to call back. If Verizon gets the iphone, I will take out a small loan to pay the ETF fees!!!!!!!!!!!!!!!!!!!!!!!!!!
AT&T started the iPhone and I’m sure they will not disappoint us soon as the iPhone 5 and 6 come into play. AT&T needs us as customers therefore need us to keep buying up their phones at a good price but everyone is right on the improvements. For all the money I spend on this nice phone I should have 4gb of memory and free mobile hotspot. Also some kind of deals on apps here and there. Many a few iTunes bucks here and there. AT&T doesn’t have bad reception in my option it’s just they need to add more to make up for the lack of improvement they make from all the money we spend and stayed loyal after verison got the iPhone.