Apple Tankwatch Message Board

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Technology Stocks : Apple Tankwatch

AAPL 273.80

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3:59 PM EST

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To: zax who wrote (16352)	1/31/2012 9:19:38 AM
From: sylvester80	Read Replies (2) of 32692

The iPhone is a raw deal for both retailers and mobile carriers – Apple effectively sucks in profits, leaving its partners weighed down by massive subsidy payments, promotional costs and/or low retail margins. This phenomenon is going global – just last week, KPN shocked European investors with lousy results it blamed on iPhone subsidies and certain consumer trends. One of those consumer trends is a decrease in text messaging – and Apple’s own messaging system is one of the SMS rivals now devouring messaging revenue of mobile carriers. How long before carriers realize that the iPhone is poison to them?? The iPhone distribution may turn out to be a poison chalice for Sprint. Sprint is not discounting it monthly package deals steeply enough to battle the Big Two, but it is going to be on the hock for massive iPhone subsidies and order commitments for years to come. Sprint and Radio Shack can sell Samsung’s or Motorola’s Android phones at a neat profit – Android vendors are forced to cut relatively sweet deals in order to compete. But with the iPhone, there will be no healthy profits for its partners. Apple leaves few crumbs on the table and in the cases of increasing the WiFi integration and messaging features of iPhones, it has deliberately aimed at undermining the core businesses its carrier hosts.

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