Originally Posted by chronster
We all know how much of a bully Apple can be when it comes to this stuff. It's their way, or the highway.
If the subsidized cost simply isn't covering the bandwidth, then Apple needs to allow carriers to sell the phone at a price that makes sense for their business!
Your analogy would make sense if Ford told BP what the cost of gas should be, and it wasn't enough to pay for the cost of getting that gas to the people.
Let's break down the iPhone revenue/cost structure.
No-contract price of iPhone 4 16GB: $700 (I'm assuming this is correct)
Price that customer pays (with 2-year contract): $200
This means that AT&T gives a $500 subsidy.
Now here is what AT&T charges for just data usage over a 2-year period:
200MB Plan: $360@$15/month for data
2GB Plan: $600@$25/month
This does not include minutes, texting, and possible overages. I bet that AT&T bets that some customers will exceed the usage limit, getting hit with an overage, which equals more money in AT&T's pocket. On a per-customer basis, AT&T makes a healthy profit on iPhone users.
It's no secret that carriers make nary a pittance on the handsets. This has always been true. That's why they give out all those BOGO deals and rebates. Carriers make money off of plans.