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News
Rumor: AT&T iPhone Deal Extended to 2010
Sunday, August 3rd, 2008 at 4:00 PM - by Jeff Gamet
AT&T’s deal to be Apple’s exclusive iPhone partner in the United States may have been extended by a year to 2010. Apparently Apple agreed to the extension in exchange for subsidized iPhone price kick-backs, according to USATODAY.
News of the new deal deadline came from unnamed sources close to the deal, but Apple and AT&T have not confirmed the details.
The per-phone subsidy payment AT&T is paying Apple comes in at about US$300, according to analyst estimates. AT&T isn’t saying exactly how much it is paying Apple, but CEO Randall Stephenson confirmed the subsidy will dilute company earnings through 2009.
Staying close to Apple and the iPhone will likely be a good move for AT&T, especially now that the combination iPod and smartphone is available for less that $200. "The iPhone has repositioned AT&T as the premier wireless brand in the world," Mr. Stephenson said.
"The $199 price point is where demand leaps," he added. "This is going to bring in a whole new demographic."
Apple set a goal to sell 10 million iPhones before the end of 2008, and it looks like the company is well on its way to hitting that number. Earlier this year, Apple revealed that it had sold over six million units since the first iPhone launch in July 2007, and the company sold over a million iPhone 3G handhelds during its July 11 launch this year.
AT&T’s iPhone 3G sales were up, too. In the first 12 days the second generation iPhone was available, the company sold twice as many units compared to the original model.
So far, the company’s exclusive deal with Apple seems to be paying off. "It’s everything we hoped it would be," Mr. Stephenson said.
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