“Movie studios and record labels have bent to Apple. But in the end, Apple bent to Cingular with a multi-year, exclusive US contract for an entire line of different iPhone models, Glenn Lurie, Cingular’s president of national distribution told journalists at the Consumer Electronics Show (CES 2007) today,” Sascha Segan reports for PC Magazine.
Segan reports, “When asked about a give-and-take leading to the Apple-Cingular partnership, Lurie said, ‘I’m not sure we gave anything.’ Later, he commented, ‘I think they bent a lot.’ That bending included allowing the phone to be locked to Cingular…”
“The contract covers ‘all models’ of the iPhone, including several other devices in the works that may be ‘coming out very quickly,’ Lurie said. His comment addressed in part a criticism that the iPhone doesn’t use Cingular’s new high-speed HSDPA network,” Segan reports.
Segan reports, “That isn’t true worldwide, as Cingular only exists in the US. Apple is free to seek other partners for global distribution, he said. And Apple is also free to build other iPods without phone capability that won’t be sold through Cingular—though he was unclear on whether a Wi-Fi only version of the iPhone would fall under Cingular’s thumb.
“While ‘there are bad guys out there that unlock phones,’ Lurie said, Apple and Cingular are taking unspecified steps to make the phone more difficult to unlock and use on other GSM carriers in the US,” Segan reports.
Segan reports, “The phone will be sold exclusively through Apple and Cingular stores, Apple and Cingular’s Web sites and Cingular’s direct-mail unit, Lurie said. It will not be available through indirect retailers, the ‘Joe’s cell phone shop’ you see on every street corner—though Apple is free to go to big-box stores like Target and Wal-Mart, Lurie said.”
More in the full article here.
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“He does not want to be seen as yet another CEO that let his company give Apple control, as everyone perceives with the music industry.”
That didn’t happen. The music industry did make Apple do what they wanted with iTMS…in the beginning. Since then it’s been the marketplace (consumers) that gave Apple what control they now have.
“A look at the incorrect and inflamatory headline explains the mis-inderstanding of all the responders.”
Hmm…no. 1) You’re correct about the headline being incorrect, but that doesn’t necessarily make it inflammatory. 2) You may be mistaken about any (in your opinion) misunderstanding of the responders.
I can only speak for myself, of course, but I did read what came after the deadline so I misunderstood nothing. Regardless of what his position with Cingular is, and because of his position with Cingular, Lurie’s comments were totally inappropriate. If he gets canned, it will be because his superiors will (rightfully) consider him a liability.
Although, personally I would give him a serious demotion rather than firing him. After all, one should take his comments in the context that they were made at CES.
I worked for a company which joint ventured with a Bell co. They were so caught up with office and desk sizes for different superior classes of management that they stifled free thinkers. This Lurie prick is typical. Steve, get rid of Cingular, ASAP.
Smells Like Teen Troll Spirit: Who the hell is Don’t Pass the koolaid??
This idiot sounds like all other DRM/Music Industry/Cell Carrier scum that we’ve all come to know and hate. I agree, with that attitude and those words, Cingular (AT&T) just f*cked themselves where The Steve is concerned.
i’m definitely cancelling my verizon contract so i can get my hands on an iPhone. I’m sure Cingular did some bending over to make the deal with Apple.
Just wait and see… in two years this phone will be the most popular in the U.S. at least (supplanting the RAZR, which came up just as quickly) and the tables will be turned. Even if Cingular was in control of this deal, they won’t be for long. Same as with the record labels.
–mAc
Can Cingular legally lock the phone or not?
I’m from france and never bought a locked phone. Even I really want it I won’t buy it if it’s come locked.
It would be intereting if Apple released a multimedia iPod with iChat that didn’t make calls through the carriers – maybe even a skype phone! That would put the pressure on Cingular.
Wi-fi iChat would be an iPod/iPhone’s killer app for me. Now that the product has been revealed, we might see competition amongst carriers in other markets. If only one of them allow unfettered ring tones and apps like iChat, they might just earn a multi-year exclusive contract. If we could find at least two of them in one market, life would be even sweeter.
We know where the future lies: VOIP. Steve’s always thinking ahead.
MW: right!
The new iPod with VoIP would kick ass. If they included the module like you can buy for your laptop for cell carrier data access you’d have access to the cell networks with no charges for individual calls….and it wouldn’t be a cell phone….Screw minutes and plans. $59 or $49 bux a month flat. Ouch. Then you can skype over the data network and have an unlocked phone.
Personally, I’m going to wait until they get up to 30 gb or so before I dive in. I have a 3g iPod and that would suck to have to start screwing around with my library to sync. Damn sexy little gadget though. The RAZR is such an annoying piece of shizznit. It is amazing how something so sleek and stylish could get so ugly when it’s hard to use and doesn’t work very well.
I’m not too concerned about how many GB the iPhone has.
After .mac becomes your .mac virtual network computer, your iPhone, your Mac, your AppleTV and yet to be announced toys and tools will become different interfaces to the same “computer” — local caches with high speed access to your data. I woudn’t be too surprised if you could open your .mac vm on a Windows or Linux box from work someday.
And you wouldn’t need a laptop module for cell carrier data access — Just a connection to the iPhone from the laptop.
why apple only sell unlocked iphones and then all carreirs compet for the visual voicemail?
“I hope he gets “steved””
Sounds like Steve got Luried…
What’s wrong with a CEO stating that they drove a hard bargain with a partner in a relatively weaker bargining position. After all cellphone networks require a huge investment to put together. Apple needs these guys more then they need Apple. You can bet if Steve had a better offer from someone else, he would have taken it.
“The whole system selling cellphones with prefixed operator is stupidest idea I’ve ever heard.”
It’s just another way of paying for the phone.
So in the USA you can either get a cheap locked phone, and pay for it over time by being locked into the contract, or buy your own handset and still be locked into the contract. You are so smart if you’d prefer the latter.
When you look that prices of high end handsets in Europe compared to the US, the US model starts to make some sense.
Shouldn’t the title be “we made apple bend OVER?”
There used to be a time when only pay-as-you-go phones were simlocked. Because when I pay for a contract phone I want to do whatever I want to with it. Even if I don’t make a sinlge call I still pay for it.
“What’s wrong with a CEO stating that they drove a hard bargain with a partner in a relatively weaker bargining position.”
Poor taste, for one thing. And for another, what makes it so? Just because Lurie said so? I think that’s just Lurie’s wishful thinking, or posturing.
Cingular drove a hard bargain? Doubtful, considering they took on the iPhone without even seeing a prototype.
“After all cellphone networks require a huge investment to put together.”
So? That’s just another business expense of theirs.
“Apple needs these guys more then they need Apple.”
The why did Cingular take on the iPhone without even seeing it?
“You can bet if Steve had a better offer from someone else, he would have taken it.”
I think Steve wanted most was an “in” to the mobile telco business. And Cingular handed it to him. Verizon was out because they would never sell the iPhone (that Jobs demoed) without crippling its most compelling features. Who does that leave, T-mobile? Their service area is a joke.
I love how people post about these sort of things as though one party (or the other) walked away with all the cookies and really stuck it to the other guy. Companies like Apple and Cingular have negotiations. One side takes this, the other side takes that. One side gives this, the other side gives that. With companies like these, no one makes anyone “bend over.”
Except the lawyers… who make everyone “bend over.”
“When you look that prices of high end handsets in Europe compared to the US, the US model starts to make some sense.”
You are the only European I’ve ever read who said that. Every other European that I’ve read who posted about this, has said the exact opposite.
Cingular drove a hard bargain? Doubtful, considering they took on the iPhone without even seeing a prototype.”
Now where’s the risk? iPhone flops, Cingular happily sells other handsets. iPhone suceeds, Cingular has some years of exclusivity. Either way Cingular wins.
“So? That’s just another business expense of theirs.”
The point is Apple needed someone with existing infrastructure. there’s no way they could justify the cost of a US wide cellular network just for the iPhone, or build it out in any rational timeframe.
Apple chose GSM, because it gets them into most of the world’s cellular markets with one handset design.
So when you go GSM, you come up with a very short list of partners, Cingular and T-Mobile. Verizon was out due to technical incompatibility.
PS. They said Apple bent, not bent over. shesh.
The negotiations go something like this: Steve: Hi Glenn, we have a really neat product called the iPhone that we’d like to develop, it’s going to be GSM because so want to sell it worldwide, and we really don’t have the experience or resources to develop multiple models for each different network type like the big boys. Glenn: Sounds like you need a US GSM provider to work with and we have way more coverage than T-Mobile. Steve: Sounds like you’re right Glenn, you’re really the only choice, would you like me to hold my ankles now?
Comparing the US cell phone market to Europe or even more ridiculously, to S. Korea or Japan is ludicrous. How many cell phone towers does it take to cover Japan, three? (I keed). But seriously, just like with our transportation system, our cell phone networks cost huge amounts of $$ because of our vast expanses of territory. Likewise, people talk about how wonderful the European transit systems are and wonder why we don’t have a similar counterpart. When I hear this I have to wonder, have these people ever looked at a map?
As long as US cell companies have to try to cover hundreds of thousands of square miles of territory, our service contracts will be expensive and our options will be limited. If you think we need to have more options, GO OUT AND START YOUR OWN CELL COMPANY! I may give you a try after you’ve spent millions just to get your first tower built.
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