Network Operator- It would not be possible for the
iPhone to succeed without a strong partnership with a US
wireless carrier. The partnership between Apple and AT&T
can be considered ‘win-win’, as both partners gain benefits.
From an AT&T perspective, with the US market potentially
moving towards a device-centric business model, the
partnership with Apple can be seen as a highly strategic
move. To add subscribers in the saturated US market,
carriers need to ‘steal’ them from other carriers [22] or
upgrade current subscribers, which iPhone has succeeded in
doing. In addition, iPhone has had a major impact on
carriers in helping sell consumers on the idea of the mobile
Internet [22]. Prior to the iPhone, AT&T had limited
success in convincing customers about the need for mobile
Internet. Perhaps most importantly, as shown earlier the
partnership with Apple has had positive effects on ARPU at
a time when voice revenues are declining. From the
perspective of Apple, AT&T gave access to a sizable
subscription base of consumers, plus subsidies for each
iPhone sold, to allow iPhone to be both mass-marketed and
profitable for Apple. At the same time, AT&T made
concessions to Apple, allowing them to sell iPhone
applications and music without sharing any revenue,
something that was not allowed with other AT&T device
manufacturers prior to Apple [41]. The emergence of Apple
in the mobile phone market has changed the game, with the
balance of power tipping in favor of device manufacturers,
where previously carriers controlled the device side of the
market [42].
Network Operator- It would not be possible for the iPhone to succeed without a strong partnership with a US wireless carrier. The partnership between Apple and AT&T can be considered ‘win-win’, as both partners gain benefits. From an AT&T perspective, with the US market potentially moving towards a device-centric business model, the partnership with Apple can be seen as a highly strategic move. To add subscribers in the saturated US market, carriers need to ‘steal’ them from other carriers [22] or upgrade current subscribers, which iPhone has succeeded in doing. In addition, iPhone has had a major impact on carriers in helping sell consumers on the idea of the mobile Internet [22]. Prior to the iPhone, AT&T had limited success in convincing customers about the need for mobile Internet. Perhaps most importantly, as shown earlier the partnership with Apple has had positive effects on ARPU at a time when voice revenues are declining. From the perspective of Apple, AT&T gave access to a sizable subscription base of consumers, plus subsidies for each iPhone sold, to allow iPhone to be both mass-marketed and profitable for Apple. At the same time, AT&T made concessions to Apple, allowing them to sell iPhone applications and music without sharing any revenue, something that was not allowed with other AT&T device manufacturers prior to Apple [41]. The emergence of Apple in the mobile phone market has changed the game, with the balance of power tipping in favor of device manufacturers, where previously carriers controlled the device side of the market [42].
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