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Apple Receives USD 800 for Each iPhone Activated in the US

Money roll in Apple's account

By Elena Balan, Communications News Editor

30th of October 2007, 08:09 GMT

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Apple's share on the iPhone's revenues seems to be larger than previously thought. The same goes for AT&T, not just for the European deals that the company recently landed, which show the fact that Apple makes more money through the share from the operator's services than
by selling the device.

AT&T pays a total of USD 18 a month to Apple for each iPhone activated on its network. A two-year contract also adds USD 432 more. Doing the math, a total of USD 831 head to Apple for each of their handset that AT&T sells.

What is surprising about these figures is that they are way higher than what is regularly seen in other excellent mobile phones. A carrier usually subsidizes the price of a high-end phone by about USD200, said Gene Munster, an analyst at Piper Jaffray. With the iPhone, AT&T doubles this figure.

Apple's deals for carrying the iPhone in European countries Britain, Germany and France have high chances of being at least just as good as that landed with AT&T. Rumors state that Apple has demanded about 40 percent of the monthly fees from the European carriers that it closed contracts for supporting the iPhone's release here.

Apple has set a large number of first timers with the release of their iPhone. Aside the large number of complications that appeared over the unlocking issue, the company's contracts with the handset's carriers have also been rather unexpected. Instead of going the old-fashioned way and selling only the rights over the handset's sales, Apple wanted part of the revenues that operators received from their customers.

The Piper Jaffray analyst takes the matter even further and makes an estimation that Apple's 2009 revenue increases from USD36 billion to USD42 billion, only on account of the iPhone's sale.

TAGS:

Apple | iPhone | activation | revenue | profit
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