Following an upgrade of the Apple Inc. (NASDAQ:AAPL) stock this morning, Citigroup (NYSE:C) analyst Michael Rollins says that the exclusive U.S. carrier deal with Apple could include payouts of up to $300 per new subscriber. According to AppleInsider, Apple Inc., could receive between $250 and $300 for each new subscriber it helps lure to Cingular's network.
Apple could see extra commissions from its iPhone partner AT&T Inc. (NYSE:T)/Cingular, if the company is able to attract "switchers" from other mobile networks. The payouts would likely come over the life of the service contracts and represent very high-margin revenue for Apple, the analyst wrote in a research report. Though the deal is not yet in place, if it were to come about look for Apple's esteemed brand to drive hoards of people to the change.
Some still seem skeptical. "The recent launch of Apple's iPhone does not pose a threat to Research In Motion Ltd.(NASDAQ:RIMM) 's consumer-geared BlackBerry Pearl and simply marks the entry of yet another competitor into the smartphone market," RIM's co-chief executive, Jim Balsillie, said in an interview.
Recently I have been interviewing for summer jobs on Wall Street. As an Apple enthusiast, I always ask the interviewer whether he or she would consider purchasing the iPhone. Thus far I have received only responses of "no way" or "the screen could break too easily," so maybe Mr. Balsillie has a point. On the other hand, those conducting the interviews may fall outside the generation expected to drive sales of the iPod; i.e., my college friends and me.
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Reader Comments (Page 1 of 1)
2-13-2007 @ 2:35AM
Ivan said...
This article has nothing to do with the headline. The iPhone doesn't pose a threat to RIM because it targets a different market segment and they don't compete head to head. One is a consumer toy phone and the other is a mobile business user's method of communication.
Disclaimer: I use neither a Blackberry or an iPod. Windows Mobile smartphone and a Zune.
2-12-2007 @ 10:36PM
jbelkin said...
The only problem with the iphone several things to consider:
people have been promised the moon - we were told that a PDA would be life changing and millions went out and bought PDAs only to realize a post it note was much easier for what they want to do ... it's not that a PDA is worthless, it's just not for everyone but the mass market of people now are gun shy about leaping into any technology ... one reason for the slow acceptance of the ipod - it almost sounds too good to be true.
But like the ipod, Apple is coming where their competitors have frankly fallen down. Yes, the Blackberry is great at push email but everything else? The OS is from 1998 just like Palm's and every other "smartphone." Now, I'm not saying the iphone will be great and perfect but we already know that cell manufacturers have taken 200 attempts at it and have failed - yea, it's just a bunch of hardware and fuunctions that everyone has but if you had to pick someone to design a portable UI, who would you pick as the most likely to succeed?
The other thing is that people seem to think Apple will only succeed if they are 31 in the market with 75% of the marlet like the ipod but clearly that is not the case. Apple is not attempting to be #1 in phone - Apple's only goal is to be #1 in smartphones and as we know, the market is really not that large and other than blackberry enterprise users, NO ONE is secure.
Appe clearly will sell the blazes out of this thing in June but it will depend on if all the software works and the features work as advetised before we can call it a success. HOnesrly Moto & Nokia don't have much to fear in terms of overall sales but high margin high vale high branding phones - unless they wake up and smell the river they are standing in ... they are like Sony, iriver or Creative mocking Apple's entry 5 years ago ...
2-13-2007 @ 6:40PM
The Loan ranger said...
By giving AAPL $300 per subscriber added may indeed be benificial to AAPL's bottom line, however I fail to see how that offer would entice users to buy the iphone in any larger volumes than with out that. That news would steer me away since cingular would probably have to pass the charge in some way to the subscribers to pay AAPL. Basically, the comment that it will increase AAPL sales is one that makes no sense what so ever- oh and I am a big fan of AAPL- just not one of ill thought out logic.