Apple's iPhone Takes Big Bites Out of Wireless Carriers' Profits
LOS ANGELES TIMES: AT&T, Sprint and Verizon, which pay hefty subsidies on the iPhones their customers buy, have seen their earnings and stock prices drop since they began offering the Apple handsets.

The iPhone has been a huge hit for Apple Inc., helping send the company's stock to all-time highs and producing record-breaking profits.

But for AT&T Inc., Sprint Nextel Corp. and Verizon Communications Inc., it's breaking the bank.

The three wireless carriers all found themselves answering to Wall Street in recent weeks for posting depressed quarterly earnings, and analysts pointed to the heavy cost of offering the iPhone as a culprit.

The iPhone has become the single most popular smartphone in the U.S., and that has left the carriers trapped in a kind of Faustian deal: The more iPhones they sell, the more money they lose.

That's because they have to buy the phone from Apple before they can sell it to their customers for hundreds of dollars less. The carriers are betting that they'll make back the difference and more by signing up customers for two-year plans and collecting monthly fees.

But so far, the carriers are finding that the math isn't adding up. » | David Sarno, Los Angeles Times | Friday, February 10, 2012

Apple Makes $13bn Profit in Three Months
THE GUARDIAN: First quarter since death of Steve Jobs sees record revenue with 37m iPhones sold

Apple reported record revenue in its first quarter since the death of Steve Jobs, as iPhone sales continued to soar.

For the three months to December 31, Apple reported net income of $13.06bn compared to net income of $6bn for the same period the previous year. » | Dominic Rushe in New York | Tuesday, January 24, 2012

THE DAILY TELEGRAPH: Apple is world's most valuable company after iPhone frenzy drives record profits: Apple has regained its position as the world's most valuable company after reporting record quarterly results that smashed market expectations. » | Harry Wilson | Wednesday, January 25, 2012

Is Apple Losing Its Touch?
THE INDEPENDENT: Crunch time for technology giant as public love affair with brand turns sour

Apple, the £150bn technology giant, is this morning preparing to confront the biggest public relations crisis in its history, amid technical problems afflicting its latest iPhone and a warning that "an emerging pattern of hubris" could wreck the public's love affair with the company.

It emerged yesterday that senior engineers warned early in the development of the new iPhone 4 that its choice of aerial could lead to dropped calls and poor reception. But the company ignored their concerns and when customers first complained about the fault wrongly blamed the problem on a software glitch.

Today the company will hold an emergency press conference in an attempt to reassure customers – and Wall Street – that it has the problem under control.

On Wall Street, where Apple has been the darling of investors for almost a decade since it unleashed the iPod music player on the world, its shares have tumbled, while the company faces a future of increased scrutiny by competition watchdogs and intense competition from newly-emboldened rivals.

Apple has summoned media and industry players to its headquarters in Cupertino, California, in a mood that is a far cry from the launch event with founder Steve Jobs last month. Then, with typical hyperbole, he declared it “the biggest leap forward” since the launch of the original iPhone in 2007, and 1.7 million people snapped up the new device in just the first two days, making it the company’s most successful product launch ever.

But users immediately started complaining of dropped calls and independent consumer tests laid the blame at the door of the phone’s aerial, which is built into the case of the phone. Continue reading and comment >>> Stephen Foley in New York | Friday, July 16, 2010

Steve Jobs


Mark Alexander