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Sprint to 'Bet the Company' on iPhone

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Re: Sprint to 'Bet the Company' on iPhone

#81

Post by chomkian »

Lewisham wrote: post #73
jwallaceparker wrote: post #64

Earlier quoted context omitted.

Customers are loyal to the iPhone, not the network it runs on. I left Sprint to get an iPhone. If I need to rejoin Sprint to get the next iPhone, that's no problem.

I wonder how true this is outside techies. I'm personally network-agnostic, as I only use my "phone" for data and calls from the wife. I use about 100 minutes a month, so it doesn't matter. My wife, however, makes at least 60 minutes of calls on more days than not, keeping in touch with friends and family (basically all the social lubrication I do with email and Google+). For her, the network effect is incredibly str…

This is where iMessage and FaceTime, GoogleVoice (via unlimited data), MagicJack and other such services step in to forge the link.

Re: Sprint to 'Bet the Company' on iPhone

#82

Post by chomkian »

acslater00 wrote: post #50
kenjackson wrote: post #25

BGR is reporting that the iPhone5 may be a Sprint exclusive. That's pretty big for Sprint. Explains why Sprint has been completely mum about Windows Phone Mango. If this is true, it might be time for me to leave Sprint. http://www.bgr.com/2011/10/03/sprint-guarantees-to-buy-over-...

If Apple made the iphone5 a Sprint exclusive, it would be unavailable to every single one of their existing customers. Literally...Every...Single...One. There's a better chance that Tim Cook will eat an iPhone than announce a Sprint exclusive.

The customers on AT&T & Verizon would still get an iPhone 4S with many of the iPhone5 features.

Re: Sprint to 'Bet the Company' on iPhone

#83

Post by dr_ »

Although exclusivity is hard to believe, the only thing that makes this plausible is that it makes sense for Apple to want multiple carriers for their products, each with lesser influence, than one or two major carriers with major influence.

Re: Sprint to 'Bet the Company' on iPhone

#84

Post by mikeash »

kenjackson wrote: post #25

BGR is reporting that the iPhone5 may be a Sprint exclusive. That's pretty big for Sprint. Explains why Sprint has been completely mum about Windows Phone Mango. If this is true, it might be time for me to leave Sprint. http://www.bgr.com/2011/10/03/sprint-guarantees-to-buy-over-...

It's completely ridiculous. 30 million iPhones over 4 years is about half the rate at which AT&T is currently selling iPhones in the US. Why would Apple give exclusivity to a lagging carrier in exchange for a promise to purchase phones at only half the rate that one of their current partners is selling them?

It seems likely to me that Sprint made this commitment in order to get access to the iPhone at all. But an exclusive on their network makes no sense at all for the relatively small deal (from Apple's perspective) being described here.

Re: Sprint to 'Bet the Company' on iPhone

#85

Post by mikeash »

jsz0 wrote: post #80
andrewljohnson wrote: post #75

If Sprint gets an exclusive on iPhone 5, there is going to be severe backlash. I know many people waiting to upgrade their phone until iPhone 5 comes out, and they aren't going to switch to Sprint to do it. This would be a betrayal of all of their customers holding iPhone 3G/3GS/4 waiting to upgrade on Verizon or AT&T, and it will be a big chink in the armor for Android to exploit. It would annoy me as a developer to…

Disagree. There's no 3G/3GS on Verizon and exactly zero iPhone 4 Verizon customers are eligible for a subsidized upgrade yet. So it only affects the tiny number of customers who are going to pay $600 for an out-of-contract upgrade. The vast majority of Verizon iPhone owners would have to wait for their subsidized upgrade date which for most is March/April 2012 at the earliest. For AT&T customers things are a bit more…

But it's not $20B in the bank, it's a commitment to buy $20B worth of phones over four years. Assuming 50% margin on Apple's side, this deal is worth about $2.5B/year. Compared to Apple's revenue of $65B/year or profit of $18B/year, this is peanuts, and not worth any sort of beating, especially since many of the sales they would make from such a deal would not be new, but merely shifted.

Re: Sprint to 'Bet the Company' on iPhone

#86

Post by Anti-Ratfish »

suhlash wrote: post #77

i am a sprint customer and i hate this move. the android market may be chaotic but there is more freedom for the user. this is a dangerous move for sprint. android will only gain in market shares baring any great upset in the current trends.

This is besides the point. Android seems to sell 3-4 phones to each iPhone sale (citation needed) so sprint is cutting itself off from 20ish percent of the market. That's what matters. Quenching the bleeding might be another perspective.

Re: Sprint to 'Bet the Company' on iPhone

#87

Post by cincinnatus »

joe_the_user wrote: post #30
biot wrote: post #9

> "Five years ago, the Motorola Razr was the top-selling phone," says > Credit Suisse analyst Jonathan Chaplin. "Imagine trying to sell 6 > million of them today." The thing about the RAZR is that it was a sleek, small form factor. I don't remember anyone who had one tout its functionality as the reason they got it. So the next sleek phone or better featured phone could easily displace it. The iPhone on the other han…

Actually, I remember numerous friends describing the original iPhone as having terrible reception. An old boss switched to skype for phone calls so he could keep using his iPhone for its apps (or something). It seems more like the iPhone combines generally good-but-not-fabulous engineering with the continued irrational loyalty of "Apple Fanboys". Edit: But this too may indeed be a competitive advantage that's hard to…

Sigh.

Re: Sprint to 'Bet the Company' on iPhone

#88

Post by stock_toaster »

mikeash wrote: post #85
jsz0 wrote: post #80

Earlier quoted context omitted.

Disagree. There's no 3G/3GS on Verizon and exactly zero iPhone 4 Verizon customers are eligible for a subsidized upgrade yet. So it only affects the tiny number of customers who are going to pay $600 for an out-of-contract upgrade. The vast majority of Verizon iPhone owners would have to wait for their subsidized upgrade date which for most is March/April 2012 at the earliest. For AT&T customers things are a bit more…

But it's not $20B in the bank, it's a commitment to buy $20B worth of phones over four years. Assuming 50% margin on Apple's side, this deal is worth about $2.5B/year. Compared to Apple's revenue of $65B/year or profit of $18B/year, this is peanuts, and not worth any sort of beating, especially since many of the sales they would make from such a deal would not be new, but merely shifted.

So a guaranteed 2.5B/year for a few months of exclusivity? Seems like a pretty big win to me.

> especially since many of the sales they would make from such a deal would not be new, but merely shifted

Possibly, but they could pick up new customers as well (existing sprint customers that want to upgrade to a smartphone, etc).

Re: Sprint to 'Bet the Company' on iPhone

#89

Post by mitchty »

jsz0 wrote: post #79
Lewisham wrote: post #42

Earlier quoted context omitted.

I can believe this story. Apple spins it that Sprint is ready now, AT&T and Verizon need to get their LTE networks ready. It'll be a very public push. Apple has never shied away from telling their "partners" exactly how annoyed they are at [X] facet of their business. If this did happen, I'm not sure what the knock-on effect for Sprint is. Anyone who wants an iPhone has one. The Verizon thing is over. All those peopl…

All those millions of people who bought the 3GS when it was released are now at the end of their 2 year contract so it's a perfect time for Sprint to make a play for them. If they discount the upfront price of the iPhone, offer unlimited data, and $50/month service lots of people are going to jump.

God yes, I love my 3gs, but its long in the tooth now.

Just give me a decent amount of minutes I'll never use, maybe 4-5g data/mon with no tethering and unlimited texts for something close to what the Europeans get service for. If carriers want to play price war, its about damn time. AT&T and Verizon aren't going to play that ball unless someone blinks.

Re: Sprint to 'Bet the Company' on iPhone

#90

Post by Kaya »

mikeash wrote: post #84
kenjackson wrote: post #25

BGR is reporting that the iPhone5 may be a Sprint exclusive. That's pretty big for Sprint. Explains why Sprint has been completely mum about Windows Phone Mango. If this is true, it might be time for me to leave Sprint. http://www.bgr.com/2011/10/03/sprint-guarantees-to-buy-over-...

It's completely ridiculous. 30 million iPhones over 4 years is about half the rate at which AT&T is currently selling iPhones in the US. Why would Apple give exclusivity to a lagging carrier in exchange for a promise to purchase phones at only half the rate that one of their current partners is selling them? It seems likely to me that Sprint made this commitment in order to get access to the iPhone at all. But an exc…

I wouldn't say it's ridiculous, given that:

- It may not possible to produce an LTE iPhone 5 for either Verizon or AT&T right how (or for any other country), as the LTE chipsets are not ready and LTE deployments are limited. However, it may be possible in six to nine months.

- WiMAX chipsets may be more mature than LTE, and Sprint's LTE deployment may be widespread, making it possible to produce such a phone for Sprint.

- Sprint has promised to buy 7.5 million iPhones a year, which is a whopping 31% of US iPhone sales

- The depth of the Sprint commitment effectively means there is no room for Android on that carrier.

So, if Apple's choices are:

a) Produce non-LTE phone for AT&T and Verizon, only to obsolete it six months later in order to compete with LTE phones running Android.

b) Give Sprint temporary six to nine month "exclusivity" to a phone that they could not produce for anyone else anyway in return for 30% more U.S. sales and killing Android on Sprint

... then it's plausible for them to choose b.

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