Apple struggling to reach iPhone deal with European carriers
Apple, which is due to launch iPhone in the United States later this month, is facing opposition for potential European wireless carriers who are unwilling to concede to the company's stringent demands, according to a recent advisory from Current Analysis.
The report, issued Monday, notes that wireless provider Orange should be a shoo-in for the iPhone contract in Europe as it's the only operator with significant EDGE coverage in the region. "But early indications are that Apple may be forced to go retail-only in Europe," wrote analyst Avi Greengart.
Several European operators reportedly advised Greengart that they had spoken to Apple and found the company “unbelievably arrogant,” making demands that “simply cannot be justified, no matter how hot the product is.”
"Several were adamant that they will never offer the iPhone," Greengart wrote. Therefore, he suggested in his report that "early indications are that Apple may be forced to go retail-only in Europe."
As far as U.S. iPhone distribution goes, the Current analyst noted that for reasons he "cannot begin to fathom," Nokia and Sony Ericsson have left the high end consumer segment completely open for Apple.
"Other than productivity-oriented devices, there is basically nothing to buy above $199 at carrier retailers, where the vast majority of phones are sold," he wrote. "A receptive home market lets Apple figure out what works, and what doesn’t, before moving abroad."
Greengart attests that iPhone will need that incubation period because once it arrives in Europe and Asia, it will encounter serious, entrenched competition. Sony Ericsson’s W950, he noted, has offered European consumers a touchscreen smartphone with 4GB flash memory and music and Web capabilities – plus UMTS – for nearly two years.
Regardless of how insanely cool the iPhone’s user interface is, the analyst also said that some consumers will always gravitate towards phones with real buttons on them. But at the same time, he believes iPhone should still sell millions of units in the first six to nine months.
"I would consider anything above 1 million units of a $500 handset a smash hit, and it looks like Apple will sell considerably more -- possibly many times that," the analyst wrote.
Those likely to adopt an iPhone when it goes on sale in the U.S. on June 29th generally fall within three separate groups, according to Greengart. There's the "The Apple Faithful," "People who want the latest 'it' thing," and "some mainstream consumers."
"There may be disagreement on the size of the first two groups, but not whether they’ll queue up to buy. If Apple sells just to them, it will have a solid hit on its hand," he wrote. "The third group, mainstream consumers, is quite controversial. This is where having actually used an iPhone -- if only for a short while -- colors my analysis."
The report, issued Monday, notes that wireless provider Orange should be a shoo-in for the iPhone contract in Europe as it's the only operator with significant EDGE coverage in the region. "But early indications are that Apple may be forced to go retail-only in Europe," wrote analyst Avi Greengart.
Several European operators reportedly advised Greengart that they had spoken to Apple and found the company “unbelievably arrogant,” making demands that “simply cannot be justified, no matter how hot the product is.”
"Several were adamant that they will never offer the iPhone," Greengart wrote. Therefore, he suggested in his report that "early indications are that Apple may be forced to go retail-only in Europe."
As far as U.S. iPhone distribution goes, the Current analyst noted that for reasons he "cannot begin to fathom," Nokia and Sony Ericsson have left the high end consumer segment completely open for Apple.
"Other than productivity-oriented devices, there is basically nothing to buy above $199 at carrier retailers, where the vast majority of phones are sold," he wrote. "A receptive home market lets Apple figure out what works, and what doesn’t, before moving abroad."
Greengart attests that iPhone will need that incubation period because once it arrives in Europe and Asia, it will encounter serious, entrenched competition. Sony Ericsson’s W950, he noted, has offered European consumers a touchscreen smartphone with 4GB flash memory and music and Web capabilities – plus UMTS – for nearly two years.
Regardless of how insanely cool the iPhone’s user interface is, the analyst also said that some consumers will always gravitate towards phones with real buttons on them. But at the same time, he believes iPhone should still sell millions of units in the first six to nine months.
"I would consider anything above 1 million units of a $500 handset a smash hit, and it looks like Apple will sell considerably more -- possibly many times that," the analyst wrote.
Those likely to adopt an iPhone when it goes on sale in the U.S. on June 29th generally fall within three separate groups, according to Greengart. There's the "The Apple Faithful," "People who want the latest 'it' thing," and "some mainstream consumers."
"There may be disagreement on the size of the first two groups, but not whether they’ll queue up to buy. If Apple sells just to them, it will have a solid hit on its hand," he wrote. "The third group, mainstream consumers, is quite controversial. This is where having actually used an iPhone -- if only for a short while -- colors my analysis."
Comments
(sigh) At least there's talks happening. What about Canada?!
There's talk happening in Canada too. I hope they have to sell it unlocked with no SIM, that would be a win for the consumer here.
(sigh) At least there's talks happening. What about Canada?!
Ever heard of the phrase "no news is good news" ?
orange are a lousy operator by all accounts so as long as its not exclusively apples and oranges it should be ok.
if it was Voda or T Mobile I'd be happy. Used to support O2 util in typical british business man short signted ness they sold out. - and yes i am british, and i notice how the best run biritsh companies have foreign ceo's
Eventually someone will have to blink and do Apple's bidding. The initial US sales figures will, I suspect, be phenomenal and nobody wants to give that sort of business to a competitor.
I think not having a partner may become more of an issue a couple of years down the road. However, if and when its numbers grow, the service providers will find it in their interest to deal with Apple.
All that said, I truly wish Apple would tone down its arrogance. That is the kind of thing that could truly destroy the company in the long run, regardless of how cool it is (or thinks it is). This attitude -- often attributed to US companies -- simply does not fly in Europe and Asia. (If they can't tone it down, they shouldn't even bother trying to enter those markets).
I don't understand why, in the first place, Apple needs a telecom service partner in Europe.
The 'visual voice mail' feature is something that has to be implemented on the carrier side.
Since that's possibly the single most 'revolutionary' feature of the phone, I doubt that Apple will partner with any carrier that won't do the work necessary to implement that feature.
All that said, I truly wish Apple would tone down its arrogance. That is the kind of thing that could truly destroy the company in the long run, regardless of how cool it is (or thinks it is). This attitude -- often attributed to US companies -- simply does not fly in Europe and Asia. (If they can't tone it down, they shouldn't even bother trying to enter those markets).
This is portentous rubbish.
This is portentous rubbish.
"Operators consistently told us, not for attribution, of course, that they had spoken to Apple and found the company 'unbelievably arrogant', making demands that 'simply cannot be justified no matter how hot the product is',"
That's your opinion.
"Operators consistently told us, not for attribution, of course, that they had spoken to Apple and found the company 'unbelievably arrogant', making demands that 'simply cannot be justified no matter how hot the product is',"
And if I were having trouble getting what I wanted from Apple I might just 'anonymously release' this information. FUD abounds everywhere.
All that said, I truly wish Apple would tone down its arrogance.
If we were talking about actual end users, then I would agree. But we're talking about telecom companies, which - if they're anything like the companies in the US (Verizon, AT&T, Sprint) - are unbelievably arrogant and treat their customers like complete sh*t...basically give them garbage service and tell them they should feel lucky to even have that.
However arrogant Apple may be in its treatment of the telecoms, it can't possibly be as arrogant as they actually deserve.
And if I were having trouble getting what I wanted from Apple I might just 'anonymously release' this information. FUD abounds everywhere.
Are the telco companies demanding to lock down features that the consumer will have to pay more money for?
Or is Apple demanding a percentage of subscription fees?
It depends on what they are negotiating.
If we were talking about actual end users, then I would agree. But we're talking about telecom companies, which - if they're anything like the companies in the US (Verizon, AT&T, Sprint) - are unbelievably arrogant and treat their customers like complete sh*t...basically give them garbage service and tell them they should feel lucky to even have that.
However arrogant Apple may be in its treatment of the telecoms, it can't possibly be as arrogant as they actually deserve.
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I haven't upgraded my Blackberry in 4 fucking years, because the new ones really don't offer anything extra. Cell phone development is fucking rediculous, and it's all because the Carriers tell the handset makers what to do. The iPhone has changed the game, and now handset makers are going to need more leeway to compete, so of course the carriers are going to have a hissy fit.
For example, here in Belgium operators can't sell a phone and a SIM (postpaid/prepaid) together. So you have to buy a phone as "bulk" and buy prepaidcards or subscribe to a postpaid contract.
The only thing they can do is put there name on the box of new phones. Like Mobistar (Orange Belgium) has phones boxed with "MobistarCollection" on it, The phone has settings for the operator preloaded but there's no SIM in the box.
So what will Apple do in Belgium?
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I haven't upgraded my Blackberry in 4 fucking years, because the new ones really don't offer anything extra. Cell phone development is fucking rediculous, and it's all because the Carriers tell the handset makers what to do. The iPhone has changed the game, and now handset makers are going to need more leeway to compete, so of course the carriers are going to have a hissy fit.
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I haven't upgraded my Blackberry in 4 fucking years, because the new ones really don't offer anything extra. Cell phone development is fucking rediculous, and it's all because the Carriers tell the handset makers what to do. The iPhone has changed the game, and now handset makers are going to need more leeway to compete, so of course the carriers are going to have a hissy fit.
The iPhone hasn't changed anything, except now its not the carriers holding back your abilities, it'll be apple. They're the ones trying to tell the carriers what to do, what to allow and not allow.