Comcast and Charter have learned a hard lesson as they build out their mobile offerings: this is Apple’s world, and they’re just living in it.
As part of their deal to carry the iPhone with their fledgling mobile plans, Apple has compelled the two largest U.S. cable companies to sell large numbers of other Apple devices as well, according to people familiar with the matter.
The cable providers decided they could not offer a viable mobile service to compete with Verizon, AT&T, Sprint and T-Mobile without carrying the iPhone, giving Apple ample leverage in negotiations, said the people.
While the exact details of Comcast and Charter’s agreement are private, Comcast has to sell a certain number of iPads, in the thousands, at a subsidized cost — with Comcast paying for the difference between the discounted price and the retail price, the people said.
Charter has a different agreement with Apple because the second-largest U.S. cable company allows its customers to use Apple TVs as replacement set-top devices for Charter’s legacy boxes.
MacDailyNews Take: In other, fewer words:
Apple uses leverage to extract favorable terms in business deals.