“Apple is likely to make so much money from its share of iPhone usage fees paid to wireless phone companies that it can sell the product at a loss and still make money. It can even cover the cost of its $100 rebates to people who bought the phone before it cut the price to $399,” Matt Richtel blogs for The New York Times.
“That’s the conclusion of Toni Sacconaghi, an analyst with Sanford C. Bernstein. In a report issued late last week, Mr. Sacconaghi undertakes a complex analysis that concludes that Apple is receiving significant payments from AT&T, a carrier with exclusive US rights to the iPhone, for the privilege of partnership,” Richtel reports.
“The iPhone could have an overall impact on the economics of the phone industry. It has put a hardware manufacturer in a highly unusual position of strength relative to the carriers,” Richtel writes.
“Apple could conceivably sell the iPhone hardware at a substantial loss while still generating greater profit per iPhone than it does from the highest-end iPod. Sounds like a good deal for Apple,” Richtel writes.
Full article here.
[Thanks to MacDailyNews Reader "Iceforest" for the heads up.]
Behold the power of iPhone.
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