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Apple gets $831 for each iPhone???

Discussion in 'APPLE iPhone, iPad Tablets and all iOS Devices' started by charlyee, Oct 29, 2007.

  1. charlyee

    charlyee Ultimate Insanity
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    The $831 iPhone:

    Apple doesn’t chat too much about the iPhone service fees AT&T shares with it. But the good folks at the Financial Accounting Standards Board (who make rules for how companies keep their books) have forced it to give us some clues. The accountants say that if someone promises to pay you money in the future (as AT&T does for each iPhone activated), you have to report this “deferred revenue” to investors.

    All this makes Apple’s financial statement into a rather complex algebra problem. Gene Munster, an analyst at Piper Jaffray, has tried to do the math.

    His bottom line is rather shocking: AT&T appears to be paying $18 a month, on average, to Apple for each iPhone activated on its network. That adds up to $432 over a two year contract. In other words, Apple will receive $831 for each iPhone it sells. (It’s a little less for iPhones sold in AT&T stores.) He can’t tell, of course, what makes up that average. Apple may, for example, receive higher payments for customers new to AT&T or those who buy more expensive monthly plans.

    Mr. Munster says he was surprised by the numbers. He previously had estimated that Apple received $6.50 a month from AT&T. A carrier will typically subsidize the price of a high-end phone by about $200, he says. With the iPhone, AT&T is spreading the payments out over time, but ultimately putting up twice the typical amount.


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  2. Jerro

    Jerro Bronze Senior Member
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    Of course Apple also gets additional fees from consumers when the glued in battery needs to be replaced by Apple.
     
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  3. Andy

    Andy Diamond Senior Member
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    Whoa....I figured AT&T is paying Apple quite a bit, but it's nice to actually see a number.
     
  4. RJB

    RJB Gold Senior Member
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    That makes me sick wow that is a staggering number
     
  5. Fire14

    Fire14 Easy,Cheap & Sleazy
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    That is amazing how much they are getting.

    I guess with stuff like this I can see why we will never see data or other prices go down & i can see prices going up, especially if other device manufactures starting to go with this plan & making it worst for all of us.
     
  6. Jay2TheRescue

    Jay2TheRescue Resident Spamslayer
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    Don't forget that thaty are locked into using media files supplied by Apple. How much iTunes revenue does an iPhone generate in 2 years?

    -Jay
     
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  7. walkguru

    walkguru Wireless Guru
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    whoa, no kidding way too much.:eek:
     
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  8. skystartrade.com

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    that is too much

    $80 per month on iphone
     
    #8 skystartrade.com, Sep 10, 2008
    Last edited by a moderator: Sep 10, 2008

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