iPhone deal with AT&T has some sweet perks for Apple
Posted by Dennis Sellers 
Jul 24, 2007 at 1:48pm
People close to Apple and AT&T told TheStreet.com that AT&T is paying Apple a bounty of between US$150 and $200 per phone—plus $9 a month per phone over the life of the typical two-year customer contract.
AT&T didn’t comment, and Apple said it would have no comment. However, TheStreet.com says that the figures show Apple is getting an unprecedented windfall on the sale of each new communications device. “It’s a pretty sweet deal for Apple, and not all that bad for AT&T,” says IAG Research’s Roger Entner.
AT&T agreed to a five-year exclusive pact to sell the iPhone. “Wall Street knew Apple was getting a good deal, but it didn’t know just how good it was,” opines TheStreet.com.
Louis Wheeler Says:
I don’t know about the $150 to $200 bounty, but it make sense to price the iPhone as low as possible. Where is the harm?
The $9 subsidy per month makes sense in light of Apple’s new accounting practice of assigning a deferred income. Apple intends to periodiclly upgrade its phone software to improve features. These are not free upgrades but will be paid for by AT&T;’s customers.
Posted on July 24, 2007
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Dennis Sellers
Dennis has been a newspaper editor/reporter (seven years) and teacher (seven years). He has over 4,000 magazine, newspaper and online articles to his credit. He has also covered the Mac and tech industries for over a decade for such online publications as MacCentral, MacMinute and now MacsimumNews.
dave Says:
Just replace “bounty” with “subsidy”, and it becomes very similar to what all other cell-phone manufacturer’s get...only part of the subsidy is spread out over 2 years.
Posted on July 24, 2007