Apple’s iPhone generates more in carrier fees than rival smartphones

“The iPhone may command a higher carrier subsidy than its typical Android rival. It may eat into operators’ profit margins when sales volumes spike after the debut of a new model. But it also generates more in carrier fees than any other smartphone,” John Paczkowski reports for AllThingsD.

“According to new data shared with AllThingsD by Consumer Intelligence Research Partners (CIRP), the average monthly carrier bill of the typical iPhone user is the highest in the smartphone market. iPhone owners spend more on wireless fees than owners of any other handset, be they Android, BlackBerry or Windows Phone,” Paczkowski reports. “Almost 60 percent of the iPhone users CIRP polled during October-December 2012 spent more than $100 per month on their wireless plan, with 10 percent spending $200 or more. Just 6 percent spent $50 or less; for Android users in that category, the percentage was double. And only 53 percent of Android users fell into the ‘over $100 per month’ category, with 7 percent landing in the ‘over $200 per month’ category.”

Paczkowski reports, “Not vast differences, but significant — particularly when carriers like AT&T and Verizon are activating millions of smartphones per quarter.”

Read more in the full article here.

MacDailyNews Take: As always, iPhone users are the cream of the crop. Everyone knows it, too: the carriers, the developers, the resellers, Apple, Google, the users…

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18 Comments

    1. There is the $45/month plan available thru StraightTalk. Unlimited everything.

      Game-changer: Walmart offers Apple’s iPhone 5 with $45 no-contract unlimited talk, text and data plan

      Drawbacks:
      1) It’s thru WalMart, who many hate as much as the carriers.
      2) They require you to buy your phone outright, rather than the “$200” phone that is subsidized by later, higher monthly bills- a payback that does not end when your contract expires. That’s the slimiest things carriers do IMO. However, WalMart is currently offering no interest financing with $25/month payments on their own credit card. (No fools they. Like Apple getting all those cards on file in ITunes, more WalMart cards hopefully turn into WalMart purchases.)

  1. Not vast difference – he says.

    Of course it is a vast difference. When you have AT&T selling 85 percent iPhones, the 200+ ten percent is 8.5 percent while the 7 percent of 15 percent equivalent android 200+ is only 1 percent. That is an 8 multiple.

  2. Since the iPhone 5 came out, all customers who switched to the iPhone 5 that were on AT&T or Verizon lost there unlimited data plans and were required to change there plans to the Share Everything or equivalent. (Some lucky people fought with AT&T / Verizon to keep there unlimited plans) But with the new plans came billing shock, customers now have to manage there data vs voice services. Many pick the larger data plans (10gb $100. or 20gb $200) in fear of going over the usage. I think if people analyze the benefits of the newer plans there is a cost savings unless you are a single user on the plan..

    1. I don’t know where you got your information, but AT&T still allows you to keep the unlimited data plan with the iPhone5. I recall hearing that Verizon forced the change, but that isn’t the case with AT&T.

      1. I’m afraid you TOTALLY missed my point. I am a TOTAL Apple house (at least 11 Apple devices, zero Micro$oft, zero Android).

        What I meant to say is that carriers are pushing Android hard over iPhones because they make more money on Android devices (NOT because they’re better). I feel SO sorry for those hapless souls who are foisted with Android garbage.

        But the fact remains that the carriers are pushing Android over iPhone and _I_ believe they’re pushing Android because they make more money on them (why else would they do that?). So I find the original article hard to believe (and, in the end, who knows better: The carriers or some researcher?)

    1. The problem is that it is the salespeople who push whatever brings in greater commission. Apple never allowed retailers to set their own retail pricing. Markup on Apple hardware has always been extremely minimal (ask anyone who ever sold Mac at retail), and Apple has always controlled the retail pricing. The retail division of the carrier likes those fat margins on Androids, so they push Android for their own benefit, even though the carrier would end up generating more revenue later down the road on an Apple device.

      So, yes, this is completely correct. Apple devices bring in more revenue through subscription, but retail divisions prefer pushing Android because Android makes them look good to their corporate bosses (bringing in more revenue than the iPhone). This is actually quite common in corporate structures that are poorly managed, where one division will do something that might be detrimental to the overall bottom line, only because it makes them look better.

      1. Are you saying that ALL carriers are poorly managed and that the CEOs can’t get profitability by making the Sales reps push iPhones?

        I find it hard to believe that ALL carriers are that stupid/inefficient.

        I have a better, albeit brain-dead psychological answer: the carriers are terrified of being dependent on one major manufacturer (namely Apple), so they push Android to make sure Apple has competition. Of course they make less money on Android, but they insure that they can’t be blackmailed by Apple (their paranoia, not mine) in the future when all the competition has died (like Blackberry & Windows Phone are about to). Just my 2¢ worth…

        1. I think your brain-dead psychological answer is actually quite plausible: the fear of all-too-powerful Apple. They hated Jobs, not because he was bad for their business, but because he was capable of convincing anyone of anything. They now hate Apple because they fear how Apple would behave with a complete monopoly. So yes, even a loss of some revenue / profit is fine, as long as they can feel they have a bit of leverage with those Androids.

        2. Are you saying that ALL carriers are poorly managed and that the CEOs can’t get profitability …

          Well, the AT&T CEO had lately been flashing his Nokia Window phone to anyone who will look.

  3. For those of you paying $100 or more for your iPhone plan, perhaps moving to a pre-paid carrier would make sense?

    Virgin sells iPhones at full price (actually, about $100 cheaper), and offers unlimited text & data (with 1200 minutes of voice) for $45. Then there is T-Mobile (with $50 unlimited everything with some throttling), SIMPLEMobile ($40 unlimited everything with throttling), plus some other regional ones.

    People don’t like the upfront $650 (or more) price of the phone, but have no problem shelling out $100 every month for something they could get for $50.

    These prepaid plans pay themselves off in less than ten months ($50 monthly difference, making up $450 upfront subsidy). Using some “Bill-Me-Later” service (six-month no interest loans), the burden would be practically the same as with the subsidised phone, but would only last for a few months, after which you’d end up paying only $50 (or even less) for the privilege of owning an iPhone.

    1. Right on. The only even close subsidized scenario is when the customer instantly upgrades to the newer models as soon as they are eligible.

      Some of us put it off for various “reasons” – i.e. Is the iPhone 5S just around the corner? Should I wait just a little? Poor logic, coupled with innate procrastination makes for sloooow motion.

  4. Tell that to Verison who allows their carriers (in multiple cities, I have proof) to do their best to talk people OUT of buying iPhones and instead settling for the imitators.

    Happend to me, happened to countless friends. Verison sales is no friend of the iPhone.

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