Apple Gets $18 per Month for Each iPhone From AT&T

According to their analysis of Apple’s earnings, Piper Jaffray is estimating that Apple gets $18 per month per iPhone. That is a staggering number. Silicon Alley Insider has interesting commentary on Piper Jaffray’s findings.

 

“Apple would record $832 in revenue over two years per phone. Research firm iSuppli estimated in July that it costs Apple $265 to build an 8-gig iPhone. So Apple's gross profit looks more like $565 per phone over two years, up 125% from our previous estimate of $250 per phone. At Apple's current U.S. run rate of about 1.8 million iPhones per quarter, that's about $1 billion in gross profit per quarter (which will be recorded over two years).”

 

The only sad thing about this comes from a consumer perspective. It means that Apple is very interested in what people do with their phones after they have purchased them. It’d be like a car salesman who gets payments from the toll roads their cars drive on—they’d want to make sure you drove on those roads. Well, Apple, toward that regard, I say, “Roads? Where we’re going, we don’t need roads.” Google and others are working on a way to free consumers from this kind of tyranny. By the time the infrastructure is built to compete with the current system, maybe Apple’s contract with AT&T will have expired.

 

At least let’s hope this also means that Apple will go to extremes to keep their phone’s running via incredible customer service.