AT&T pushing to keep iPhone exclusive through 2011

Posted:
in iPhone edited January 2014
Having locked down the iPhone for at least three years, AT&T is now expected to take one more shot at an exclusive deal for the Apple handset and may keep it away from competitors until 2011.



Talking to the expected "people familiar with the matter," the Wall Street Journal hears that AT&T has a deal to keep the iPhone in its stable until 2010 and that negotiations are underway to have the device onboard for one more year.



Not surprisingly, there is no word from AT&T on the subject, and an Apple spokeswoman would only say that the two companies have a "great relationship."



The supposedly inside information echoes a report from last year that also said AT&T had struck a deal to keep the iPhone until 2010 and may provide insight into current talks. At the time, the cellular carrier reportedly agreed to allow iPhone 3G subsidies in exchange for a one-year extension of the iPhone's US exclusivity. Although the cost of discounting those phones has been severe -- as much as $1.3 billion to date, according to an estimate -- the agreement renewed interest in AT&T and gave it millions of users paying at least $60 per month (on grandfathered plans) for service.



Also, the iPhone gives AT&T a way of keeping customers from jumping ship to Verizon or another alternative at a time when the market is saturated and customers are more likely to have switched than sign up for the first time. The company added 1.9 million iPhone users just in the fall 2008 quarter alone and notes that many of these are less likely to give up on service than those who use other phones.



No matter how successful AT&T may be in lengthening its time spent with the iPhone, the firm is likely to maintain an inherent technological basis for holding the device close until two years later. As the only major US carrier with 3G using the HSPA standard on the 850MHz band, the iPhone as-is only supports its service for full data. Adapting the phone to T-Mobile USA would most likely require adding the 1,700MHz band, while switching to Sprint or Verizon would, for now, need a complete overhaul that swaps in CDMA calling and 3G access using EVDO; either of these is expected to gradually phase out.



Eventually, AT&T and Verizon will share the same network format when they both move to 4G using the Long Term Evolution format, but neither expects to have any significant networks until 2010, rendering any truly multi-carrier US iPhone impractical until the possible new expiry date for the agreement between AT&T and Apple.
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Comments

  • Reply 1 of 147
    trapttrapt Posts: 3member
    Unbelievable. This is wrong. We need to start a movement online to tell Apple we are not happy and this is not acceptable. We need some fair competition.
  • Reply 2 of 147
    iansilviansilv Posts: 283member
    ^^^ I agree. The thing that scares me is the idea of data caps or restrictions on what kinds of data can be transferred- like Skype not being allowed to run on 3g. Also- if the next iPhone does video calling- it would really suck if ATT tries to charge those as separate minutes. We need carrier competition. And come on Apple- won't you make more money?
  • Reply 3 of 147
    wobegonwobegon Posts: 764member
    Quote:
    Originally Posted by Trapt View Post


    Unbelievable. This is wrong. We need to start a movement online to tell Apple we are not happy and this is not acceptable. We need some fair competition.



    Serious competition will only come when Verizon switches over to LTE UMTS. Currently, AT&T already does UMTS while Verizon is still using the old EVDO.
  • Reply 4 of 147
    l008coml008com Posts: 163member
    It sucks, but like the article says, theres no real way to use it with other carriers anyway. AT&T's network sucks. Verizons is much better but I doubt there will be a CDMA iphone. I'd get it if there was though. I have so many AT&T rollover minutes because I get such poor signal, I have to use skype to make calls when I'm at home.
  • Reply 5 of 147
    benroethigbenroethig Posts: 2,782member
    I don't see a reason not to if they're going to be staying GSM only for the iPhone 3G. the 4G, however, should not have an exclusive deal.
  • Reply 6 of 147
    trapttrapt Posts: 3member
    Please Digg: at&t looks to keep its iPhone exclusive



    http://digg.com/apple/at_t_looks_to_...hone_exclusive
  • Reply 7 of 147
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by AppleInsider View Post


    Although the cost of discounting those phones has been severe the agreement renewed interest in AT&T and gave it millions of users paying at least $60 per month (on grandfathered plans) for service.



    I don't understand this sentence. It read to me that I could have gotten the cheaper iPhone data plan when i moved to the 3G iPhone because I had the original iPhone at the time. I'm sure this is not correct so what am I missing here?





    Quote:
    Originally Posted by Trapt View Post


    Unbelievable. This is wrong. We need to start a movement online to tell Apple we are not happy and this is not acceptable. We need some fair competition.



    What movement would that be? A movement to force Apple to engineer a second iPhone that works on CDMA-base networks and a third iPhone that works with T-Mobile's wonky cellular radio frequencies? A movement to force Apple to note have exclusive deals with carriers even though they existed long before Apple's foray into the cellular market and still exist today, the next major one being the Palm Pre on Sprint? Or would this be a movement to make Apple be a socialized company while all other companies can act normally within a free market?



    You don't have to like it, but it normal business to have exclusive deals and it's completely legal. What is unusual is that handset is so successful that the carrier wants to extend the deal even longer despite the cost it incurs for maintaining this partnership. Though as the article stated, since there is no other viable non-MVNO carrier in the US that can handle Apple's GSM/UMTS-phone that is pretty universal in most major cell countries.
  • Reply 8 of 147
    old-wizold-wiz Posts: 194member
    I'd love an iPhone not on AT&T. Their network sucks. Go to other carriers and I'll buy one.
  • Reply 9 of 147
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by l008com View Post


    Verizons is much better but I doubt there will be a CDMA iphone.



    The non-stockholder part of me hopes that Apple doesn't make a CDMA phone for China Unicom. When they do these forums will be filled with all sorts of new posters whining "why isn't Apple releasing it here".





    Quote:
    Originally Posted by BenRoethig View Post


    I don't see a reason not to if they're going to be staying GSM only for the iPhone 3G. the 4G, however, should not have an exclusive deal.



    I would think that it wouldn't be, but if AT&T offers to pay Apple enough and to add the network features that Apple wants then it might happen as it would surely set the iPhone apart even further and let Apple play in areas that other cellphone vendors don't get to play in. Without the carrier lock in there are many aspects of the iPhone that would never had seen the light of day from a carrier with subsidy and the data plan would never have started at $20. We'd have to buy it from Apple Store and their retailers at full price.







    PS: @ Trapt, Buried your Digg link for being incorrect of your assessment of what competition is.
  • Reply 10 of 147
    trapttrapt Posts: 3member
    Quote:
    Originally Posted by old-wiz View Post


    I'd love an iPhone not on AT&T. Their network sucks. Go to other carriers and I'll buy one.



    Exactly.



    The AT&T network around here completely sucks. Even the demo iPhones (As well as my own) always say "No Service" at Wal-mart. It is laughable. Apple needs to think about what would benefit the customer who buys their products.
  • Reply 11 of 147
    ibillibill Posts: 391member
    Quote:
    Originally Posted by old-wiz View Post


    I'd love an iPhone not on AT&T. Their network sucks. Go to other carriers and I'll buy one.



    As has been said already, it's almost certainly not going to happen in the US until after 2010 when a carrier other than ATT migrates their network.



    It's pointless to blame Apple, the cell market here in the US is wonky and it's not Apple's fault.
  • Reply 12 of 147
    bsenkabsenka Posts: 799member
    I would really like it see Apple either end exclusivity altogether, or at least release different models to different carriers.



    Tying a cell phone to one carrier is something consumers really should demand an end to. Imagine a computer that could only use cable internet and not DSL, or a TV that could only use one cable company, a car that was restricted to certain roads, etc. Yes, I'm aware that cell phones are subsidized. I'd like to see that end too. Bring on an era of truth in pricing.
  • Reply 13 of 147
    They are just delaying the inevitable. As soon as another major carrier (Verizon, T-Mobile, etc) gets the iPhone in their lineup, people will jump ship from AT&T in droves. I would buy an iPhone tomorrow if their service in rural areas didn't suck so much. Even in the big cities it sucks. The iPhone was the best thing to ever happen to AT&T and the worst thing to happen to Verizon. AT&T will fall into mobile obscurity once again, the sooner the better.



    Personally want to see US Cellular get the iPhone, but since they are such a small company I doubt it will anytime soon. Would be great if AT&T would buy US Cellular though. End of problem.
  • Reply 14 of 147
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by Trapt View Post


    Exactly.



    The AT&T network around here completely sucks. Even the demo iPhones (As well as my own) always say "No Service" at Wal-mart. It is laughable.



    Let's consider your previous request. Let's say that no cellphone is allowed to be tied to a carrier in any exclusive deal. Now let's say that the iPhone can be yours and you can buy it outright at the full cost of $600-$800. What carrier would you choose and why would you choose them?
  • Reply 15 of 147
    ajitmdajitmd Posts: 365member
    Apple is just being insensitive to the consumer needs. It is not big deal to have phones offered to different carriers supporting different radio technologies and frequency bands. Black Berry products are offered across GSM, CDMA, etc.



    The CDMA tech with EVDO is actually much more mature than UMTS 3G. It uses synch CDMA and it is very power efficient as more reliable as the Verizon network indicates, especially in the lower frequencies. It is cheaper than UMTS to implement.



    Companies like QCOM offer chipsets that can support both systems plus legacy GSM all in the same phone. Apple has a great product... the best. However, in tech there is always somebody trying to improve. 2011 is an eternity in tech.



    I like the iPhone, and I have been to the ATT store thinking about switching over to ATT, but their onerous terms along with reported poor coverage was a bitter pill to swallow so I backed away.
  • Reply 16 of 147
    I dropped three calls today with a full five bars of 3G.
  • Reply 17 of 147
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by AjitMD View Post


    Apple is just being insensitive to the consumer needs. It is not big deal to have phones offered to different carriers supporting different radio technologies and frequency bands. Black Berry products are offered across GSM, CDMA, etc.



    RiM has been making cellphones for how long now? I don't think it's uncommon for a company to start small and eventually expand once it's outgrown its comfort zone. Despite the excellent first release of the iPhone — which is partly due to not only releasing on one carrier but have an exclusive agreement with the carrier that allowed them to try some new things to improve the user experience — there is plenty of evidence that Apple had some growing pains with the cellular aspect of their popular device. Even Palm with their long history is starting out with an exclusive Sprint contract with their Pre, just as other before and other after them will do.



    But despite this long term experience that RiM has had with US cellular carriers what you state isn't exactly true. The BlackBerry Storm debuted exclusively on Verizon's network in the same way that Apple first debuted its iPhone exclusively with AT&T. The Storm is considered a true world phone in that it has CDMA/EV-D0 and GSM/UMTS radios in it (though oddly lacking WiFi), Yet despite this inclusion of GSM/UMTS, the only data that will work on US GSM-based carriers is GPRS and EDGE as the 3G radios are incompatible with N. America. That doesn't sound like RiM is supporting all US carriers like you say.
  • Reply 18 of 147
    macrrmacrr Posts: 488member
    AT&T blows so hard in SF, CA I use it as a laptop and clumsily txt. i rarely use it as a phone- and if i do I have to run out of my house down to AT&T park to get a 5 bar 3G signal that will drop the call invariably.



    it's shameful shit
  • Reply 19 of 147
    Quote:
    Originally Posted by Trapt View Post


    Unbelievable. This is wrong. We need to start a movement online to tell Apple we are not happy and this is not acceptable. We need some fair competition.



    I have had no problems with AT&T, beyond those that one can experience with any carrier. In Chicago, AT&T 3G service has been terrific. I travel a great deal, and seldom have anything but the usual "transient" cell phone problems.



    I accept that others can have problems elsewhere.



    However AT&T have been a loyal partner with Apple, showing enthusiasm and opening up the whole cellphone world to a company (Apple) that most "experts" said would never break thru in the cell market.



    Loyalty counts.



    AT&T should of course be encouraged to make improvements and changes. But our whole experience will be degraded if any poor schmuck can offer iPhones.



    Loyalty counts, and should be rewarded and encouraged, not abandoned at the first available opportunity.
  • Reply 20 of 147
    davidwdavidw Posts: 939member
    Quote:
    Originally Posted by solipsism View Post


    I don't understand this sentence. It read to me that I could have gotten the cheaper iPhone data plan when i moved to the 3G iPhone because I had the original iPhone at the time. I'm sure this is not correct so what am I missing here?



    If I remember correctly. Since the original iPhone was not subsidized by ATT, ATT offered all it's iPhone users an upgrade offer. They could get the iPhone 3G for $399 and keep their current contract for the rest of their 2 year contract. Which was the special $60/month voice/data plan for iPhones. However, I don't think you got 3G with it. You were restricted to the orginal EDGE network. After the two year contract is up, you got to switch over to the $70/month voice/data w/3G if you want to sign a contract.



    Or they let you off your old contract, with no cacellation fee, if you sign up for a new 2 year contract with a subsidized iPhone 3G at $199.
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