Russia's Megafon deal with Apple, Inc. guarantees sales of 750k iPhones over 3 years
Russia's second largest carrier Megafon said its iPhone agreement with Apple requires it to sell 750,000 iPhones over three years and spend $28 million on marketing and promotion through 2016.
The terms of the agreement were spelled out in the carrier's 2013 financial report, which was released this week and reported by Reuters.
The details illuminate the type of agreements Apple makes with carriers. By specifying aggressive minimum sales and incorporating co-marketing budgets, Apple aligns carrier's goals with its own.
Reuters cited Sergei Libin, an analyst at Raiffeisen Research, as describing Megafon's minimum iPhone sales volume as "reasonable," adding that "I would not say it could sell much more than this."
Megafon stopped carrying Apple's iPhone in 2009 over a dispute regarding sales guarantees, but after four years it decided to return in January. Third place Russian carrier Vimpelcom similarly signed a deal with Apple last fall.
Apple's iPhone currently holds a 9 percent unit share of the overall smartphone market in Russia, but commands 20 percent of the industry's $5 billion in annual revenues, Reuters noted.