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Inside Apple's contract with AT&T, GTA headed to iPhone


A new report questions whether obtaining the iPhone was a good deal for AT&T; and Grand Theft Auto, one of the most successful video game franchises of all time, is coming to the iPhone this fall.

iPhone as AT&T's "sour apple"

In a look at the exclusive deal between AT&T and Apple for the iPhone in the U.S., The Wall Street Journal asks whether the exclusive contract amounted to a raw deal for the wireless carrier. Author Martin Peers notes that of 10 million iPhone activations since 2007, "only" 40 percent were new customers.

"That means only four million new customers signed up, about 5 percent of AT&T's total, or 6 percent of "postpaid" customers on costly monthly contracts," the report states. "Complicating the math is that some activations represent upgrades from earlier iPhone versions. AT&T said last month that it had about nine million iPhone customers."

Peers goes on to note that AT&T is estimated to spend roughly $400 per sold phone on subsidies, though those reports are unconfirmed. But because that estimated total is much higher than other smartphones, the report suggests that the iPhone has "depressed AT&T profit margins."

AT&T essentially said as much last month, when the company's quarterly earnings fell on the cost of the iPhone subsidy. The successful launch of the iPhone 3GS led to a 15 percent year over year decline for the wireless carrier.

In addition, Peers said, the Web-centric iPhone has placed a strain on AT&T's network. Because the performance has been so poor, he concludes that public perception has been damaged, something that "may be difficult to repair."

"Whatever value AT&T got from the device," he concluded, "it seems clear that Apple was the real beneficiary."

Rockstar to bring GTA, Beaterator to iPhone

Rockstar Games announced Monday that it would port its portable version of Grand Theft Auto: Chinatown Wars from the Nintendo DS to the iPhone. The game is expected to arrive this fall.

“Chinatown Wars is a perfect match for the iPhone and iPod touch. We are very excited to bring this incredibly ambitious version of Liberty City, with this level of detail and immersive gameplay on Apple’s new gaming platforms,” Rockstar President Sam Houser said.

Chinatown Wars is one of the best-reviewed games for Nintendo's mobile device. After lackluster sales following the title's debut, Rockstar also announced its intentions to port the title to the Sony PlayStation Portable.

Rockstar also announced that Beaterator, its rhythm game already announced for the Sony PSP, will also make its way to the iPhone and iPod touch this fall.

"The simple, pick-up-and-play nature of Beaterator lends itself so well to the Apple platforms," Houser said. "We are happy to deliver an application that allows for such unprecedented sharing and ease-of-use."