iPhone buyers, fear not over carrier subsidies, says analyst

iPhone | Monday May 7 2012 1:31 AM | Comments (0) Tags: , , , , , , ,

iPhone buyers, fear not over carrier subsidies, says analyst

(Credit:
Apple )

iPhone buyers have nothing to worry about, at least when it comes to carrier subsidies.

Recent moves by two Spanish carriers to eliminate subsidies for new iPhone users triggered fears that other carriers could do the same. Removing the subsidy paid by carriers to Apple means buyers would have to shell out the full retail price for the phone.

But Morgan Stanley analyst Katy Huberty sees little or no chance of that trend spreading any further.

In a research note published today, Huberty said that all three U.S. iPhone carriers are required by contract to provide certain subsidies. The contracts currently in place last for several years. And since each of the three contracts expires at a different date, the carriers can’t all “team up” at the same time to jointly pressure Apple to lower subsidies.

T-Mobile USA Chief Marketing Officer Cole Brodman said in March that he believes subsidies are hurting the wireless industry and that he would like to see them go away. But the three big U.S. iPhones carriers — Verizon, AT&T, and Sprint — rely on subsidized phones to lure in customers.

Carriers actually lose money on many smartphones up front due to heavy subsidies and only break even … [Read more]

iPhone buyers, fear not over carrier subsidies, says analyst

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