Three Guys and a Podcast

Three Guys and a Podcast: Apple News & Analysis

August 02, 2011 at 1:57pm Pacific Time
by: Mark Reschke
Categories: iPhone, News, Rumors
tagged: iPhone_5,, Carriers,, Sprint,, Verizon,, Apple

Apple doesn't have partners, they have suppliers. But when Apple entered the cell industry it had no choice but to enter into partnership agreements with AT&T and others across the globe. Don't confuse necessity with anything Jobs and company are happy with, as Apple is setting course to go nuclear with its pernicious carriers.

Until now, the iPhone has been built with the philosophy of design elegance and overall quality. Apple has been able to work this way due to the business model being focused on subsidized products, hidding the true costs of iPhones into two-year contracts. But Apple's forthcoming iPhone 5 launch promises to change this model and the way we purchase iPhones.

It has been rumored Apple is targeting a $350 price point for an entry level unlocked iPhone. The main purpose for such a device is to penetrate China and other regions which are not fond of subsidized programs. If Apple can deliver an unlocked iPhone starting at $350, the impact in China will be stunning, and send U.S. and European carriers scrambling.

Imagine walking into an Apple store to purchase a 8GB iPhone for $349, and choose any prepaid plan of your choice. Purchase an all-you-can-eat $50 month-to-month T-Mobile or Cricket or Boost plan. The forthcoming iPhone will likely contain a universal 3G chipset from Qualcomm, so it will work with botCDMA or GSM carriers, take your pick.

What can AT&T, Verizon (and perhaps Sprint coming onboard this fall), do to stem the tied of unlocked iPhones roaming the globe? Predictably so, carriers will push anything but Apple iPhones, but rowing upstream only goes so far. The second move carriers will be forced to adopt are lower entry prices for the iPhone.

Plan on AT&T, Verizon and Sprint offering two-year contract plans for the iPhone 5 starting at $149. Carriers wil be scrambling to protect a model that has done them so well for the past 15 years. However, Apple is about to pull it all apart with a single product launch. 

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2 Comments

  1. George ~ August 02, 2011 12:45

    Funny, we can buy an unlocked phone in Canada any time, ever since the 4 came out. Double the price you note, but that is what one gets as an early adopter! 399, that would really destroy some companies. #
  2. mbaDad ~ August 02, 2011 14:39

    Fingers crossed... if they do will likely buy our first two iPhones! #

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