The End of AT&T’s Absolute Advantage in iPhone Sales
The iPhone is the most sought-after smartphone on the market today. Since 2007, the iPhone is currently available only through AT&T. For years, there have been rumors that other wireless providers, such as Sprint, T-Mobile or Verizon Wireless would get the iPhone. In October, the Wall Street Journal reported that Apple is in the process of producing an iPhone that will be available to Verizon Wireless customers beginning in 2011. With large numbers of customers wanting an iPhone but choosing not to sign with AT&T, competition from other smartphones manufacturers, such as the BlackBerry and Droid, and Apple’s search for new areas of growth, an end to AT&T’s absolute advantage in iPhone sales appears to be on the horizon. For years, AT&T has had an absolute advantage over Verizon Wireless, Sprint and T-Mobile with the iPhone, thanks to an exclusive contract with Apple, who is expected to sell 40 million iPhones worldwide this year. This absolute advantage has led to AT&T’s growth in recent years, making them one of the largest mobile network providers in the United States, second to Verizon Wireless. This growth, however, has slowed in recent years, as most AT&T customers who wanted the iPhone has bought them. People who have wanted an iPhone, but did not want to sign with AT&T, have purchased their iPhones thru AT&T without a contract, or through secondary markets such as eBay, and have “jailbroken” or hacked their iPhones to work outside of AT&T’s network. This results in the user not maintaining the full functionality of the iPhone itself. They have an iPhone, and they can use it on Sprint or T-Mobile, but they cannot use all of the features of the iPhone. With the iPhone coming to Verizon Wireless, this appears to no longer be the case. Apple is searching for new areas of growth, thanks in part to iPhone alternatives. These alternatives include BlackBerry,...
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