This study might be related to Nokia's rumoured Maemo-phone's fortunes...

Study: iPhone is a detriment to carriers

Saw that article yesterday. I'm sure the business case was well studied by Apple and goes to show how smart they are when it comes to maximizing their profits. The deals they sign with carriers literally cripple them and ATT has probably gotten more bad press about how terrible their network is because of the iPhone than they could have ever anticipated.

I remember when Nokia was trying to push hard to buy unlocked phones (N95) here in North America to free themselves from carrier controls, it was right around the launch of the iPhone. Even in face of all this evidence to the contrary, I maintain to this day if Apple had launched with an unlocked iPhone sold through their Apple Stores and online and sold services such as Visual Voicemail, MobileMe etc through their own servers as mandatory monthly/yearly add on services, they would have made a killing *and* revolutionized the North American mobile market.

@mobiledivide: That would make the iPhones cost $599 and $699 (4gb & 8gb). I really doubt they would get anywhere close to the number of their current users selling at that price levels. Remember how crappy the first iphone was? No AppStore, no Cut\Copy\Paste, just the build in apps and a good browser.

Even on their current iteration, with all the new features, access to the very popular appstore, the unlocked prices of $599 and $699 (16gb & 32gb) are still very high for many.

Bundling the phone with carriers contract act as a financing programme, and AFAIK a financing option always opens up your product to more potential customers.

Definitely wishful thinking on my part, I wonder whether the real wholesale price for ATT is $599 or $699 or if they get a deal on the subsidy such as $399 or $450? Flagship Nokia phones always debut at $699 or so (E90, N97,n96, N95-4) but within a few months are around $400 unlocked. I was really thinking along the lines of if Apple sold an end user a phone for $299 or $199 (subsidized) and which then required a 2 year subscription to MobileMe or Visual Voicemail.
This would remove the carriers from the equation and free users to use T-Mobile, ATT, Rogers etc. The full price device would be the same and the carriers would be one step closer to being dumb pipes.

Of course AT&T gets wholesale price.. and I've no idea how further south those would be below Apple's $599 & $699 price points. I'm guessing $400-450 as the price for the base model would be about right..

Mobile me is $99 per year direct from Apple and around $65 if you buy from Ebay. Or $149 for the family pack (5 users), which is $100ish from Ebay. The value is really low compared to what kind of money people spend on their mobile packages, which allows device+mobile subscription bundles to be attractive to many people.

I, too, 'dream' of the day that mobile voice+data plans become lower priced\reasonable flat rates. But realistically, this won't happen overnight or done by a single device. Love it or loath it, iPhone is a great step in that direction as they've brought a sizeable userbase which would probably be ignorant of packet data without the iPhone.

Totally agree. If Apple had released the iPhone unlocked-only and sold it through retailers, no network would have dared to exclude it. At a stroke it would have done far more for American mobile phones than any interface or hardware design, because it would have shown all the US networks' claims about "activation" and many other issues to be a pack of lies.

It would have been a real revolution for the US market, because the effects would have been felt across the entire American market on non-Apple devices too. It would have put network operators in their place, as ISP-style dumb pipes, instead of the jumped up control freaks which they are right now.

Remember how AOL used to try and control users' experience from start to finish, and then had to give in and let people just use the open internet? The US network operators are trying to still be AOL.

It's the business structure that makes American network operators possibly the worst in the developed world. They have too much control over hardware and too little incentive to compete with each other. Only in America do people pay to receive phone calls, it's a symptom of a crazy twisted system.

That's just it. They don't want to revolutionize it. User freedom and choice injects too much volatility into the market, and companies hate volatility. They always prefer to keep to known, predictable outcomes. And if that means keeping the cellular companies happy by ensuring network lockin, then so be it. Few companies ever want to truly be any kind of "innovator". The horrid excuse for the pocket rape they call "innovation" is anything but that. Typically their idea of innovation anything that's already been around a while (usually stolen from DIY'ers and product hackers), tested, and proven to be a viable product.

The only real innovation anymore comes from these same DIY'ers and product hackers. The companies themselves just take those ideas, repackage them, and then sell them as their own. Of course, on the flipside, sometimes it takes the DIY'ers and product hackers in order to actually get anything truly innovative, since companies like the "slow and safe" approach to everything.

Does it bother me? Of course it does! It drives me nuts that this happens. Is it wrong? Well, yes, in a way, but in the end it's the only way we actually get these "innovations" into our houses, so either we have to do it for ourselves, or wait for a company to do it for us, and then pay them for the privilege of owning such said innovation.

"Pocket rape"? Ouch! Of course, I agree with you completely. Most of us - myself included - have only a dim understanding of the DIY and hacking world, other than a fuzzy idea that HP and Apple came from hackers working out of garages with wire cutters and welding torches or something like that.

It's good to be reminded that true innovation is still going on, albeit unsung and underreported.

I will add that I think awareness and participation is increasing. We have the internet to thank for that. How quickly after the iphone was introduced did millions of google hits referencing the term "jailbreaking" spring up?