Tuesday, January 18, 2011, 05:00 pm PT (08:00 pm ET)
Apple inks new iPhone deal with AT&T, all exclusive contracts now overApple announced that in addition to its new non-exclusive agreement with Verizon, it had signed a new non-exclusive agreement with AT&T that brings to a close all carrier-exclusive iPhone contracts worldwide.
Without going into details, Apple's chief operations officer Tim Cook described signing "a multi-year, non-exclusive deal with AT&T," before affirming that "we are not in a contractual exclusivity now in any country in the world; the last one was the US. We have moved away from those."
Cook also noted that "we've seen this in every case where we've moved from exclusive carrier arrangement to a dual- or multi-carrier arrangement: our growth has changed significantly and our market share has increased," although he said that "Not in every country nor are we out doing that [signing up multiple carriers] in every country. Each market has their own parameters and technology."
That raised the question of whether Apple would be using its CDMA iPhone 4, unveiled in its new carrier relationship with Verizon Wireless in the US, to expand its carrier partnerships in other countries, where CDMA offers either another avenue for growth, or a far superior carrier partnership potential.
Cook refused to comment on specifics, saying, "Don't want to comment about any specific country, because any conversations ongoing are confidential in nature," before adding, "I can guarantee you that we always are looking at opportunities to grow."
Responding to a question of whether it was "unreasonable to expect to see more CDMA carriers going forward," Cook replied, "On the CDMA front, I don't have anything specific to announce today other than we are thrilled to be working with the Verizon team. A lot of respect for their customers and some of them have waited a long time for an iPhone."
Cook added, "And non-Verizon customers that wish to buy an iPhone," artfully dodging the idea that a significant number of AT&T's existing iPhone users are expected to jump ship for Verizon simply to have basic service on their phone.
Broadening Apple's Verizons
Outside of the US, India has the second largest deployment of CDMA, offering roughly 100 million subscribers. Apple currently has partnerships with Vodafone and Airtel, but is still only officially offering the iPhone 3G in the country.
A reader reports that the state owned BSNL recently released a carrier settings update for his iPad, suggesting Apple may be bringing its tablet and newer iPhones to the country's largest carrier soon.
However, the CDMA iPhone 4 now enables Apple to also partner with Reliance, which serves around 57 million CDMA subscribers in the country. It also has a smaller GSM business of 30 million users.
Similarly, Apple's current iPhone partner in China, China Unicom, has been its only real choice for partnership because it runs the only real GSM/UMTS network in the country. Its smaller competitor, China Telecom, operates a CDMA mobile network with a stronger presence in the south. The largest Chinese carrier, China Mobile, offers little 3G service but is building out its own proprietary TD-SCDMA network, which is unique to China and would require its own new iPhone design to use.
The CDMA iPhone 4 would similarly enable Apple to partner with China Telecom, establishing dual carriers in the country and reaching areas where its existing carrier offers weaker service. China Telecom appears to serve around 40 million CDMA customers.
While Verizon-compatible CDMA mobile service is being replaced in most countries around the world with new generations of 3GPP standards, just between those two potential new carriers in China and India, Apple has an addressable market for CDMA subscribers similar to that of Verizon in the US.
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