Apple adds T-Mobile as final big carrier to sell iPhone
T-Mobile USA Inc. will begin offering Apple Inc.'s iPhone next year, becoming the last of the four largest U.S. carriers to offer the best-selling device.
Deutsche Telekom AG, T-Mobile's parent, disclosed the agreement to sell Apple products in 2013 in a statement on Thursday. Larger U.S. competitors Verizon Wireless, AT&T Inc. and Sprint Nextel Corp. all sell the iPhone.
The iPhone, once offered exclusively by AT&T in the U.S., has evolved into one of the most widely available handsets in the country. Adding Apple's device may help T-Mobile lure more customers to long-term contracts and hold on to more subscribers.
“A certain number of people wouldn't come to our stores if we didn't have the iPhone,” T-Mobile Chief Executive Officer John Legere said. “We worked very hard for a deal that made sense for us.”
The iPhone is the No. 1 smartphone in the U.S., outselling all handsets using Google Inc.'s Android software combined in the 12 weeks through Oct. 28, according to Kantar Worldpanel ComTech. The agreement with Apple will add to T-Mobile's profit and cash flow starting in 2014, said Legere, speaking at an investor summit in Bonn.
Without the iPhone, T-Mobile has struggled to keep customers from choosing other carriers. T-Mobile has lost 1.03 million monthly contract customers, or more than 4 percent of its subscriber base, since the end of last year.
T-Mobile had 8.7 percent of U.S. contract customers at the end of 2011, according to Bloomberg Industries research.
A year ago, Sprint became Apple's third U.S. carrier partner when it agreed to a four-year, $15.5 billion commitment to sell 25 million to 30 million iPhones. Due to the heavy discounts carriers place on smartphones to lure customers into two-year contracts, the initial cost of iPhone sales have cut into profit margins.
T-Mobile's agreement with Apple isn't as extensive as Sprint's, Legere said.
“This is not a volume commitment of the size that Sprint agreed to or anything close to it,” he said. “This device rollout will be a dramatically different experience,”
T-Mobile will soon be starting an “in-your-face” style advertising campaign aimed at the larger carriers, Legere said. That theme highlights some of the competitive tension coming to the U.S. market as the iPhone playing field becomes more level, said Craig Moffett, an analyst with Sanford C Bernstein & Co.
“A T-Mobile iPhone is good news for Apple, good news for T-Mobile, and good news for consumers. But it's bad news for everybody else,” said Moffett. “By ‘everybody else,' I mean Sprint, AT&T, and Verizon.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Chevron settles fatal well fire lawsuit for $5 million
- Task force to plot ways of easing gas glut in Pennsylvania via pipelines
- IRS cybersecurity breach touches lives of homebuyers, others
- Tesla home battery at $7K, partnered with rooftop solar system, may help reduce power bills
- UPMC offering buyouts to 3,500 employees in cost-cutting move
- Pitt study suggests health law attracting young to balance insurers’ risks
- Many Americans have no retirement savings, Fed survey shows
- Shoppers pay premium for organic chicken
- Apple finds bug that causes iPhones to crash
- Automakers do U-turn on infotainment systems
- Stocks bounce back from losses on reassurance from Greece