Monday, April 16, 2012

iPhone subsidies to come back down to Earth?

I've mentioned before about the disparity of subsidies between the iPhone and all other phones, and how iPhone users result in losses for the wireless carriers.  Looks like the good times may be ending.

Wall Street analysts believe that carriers may soon cut down on those subsidies that make iPhones price-competitive with Androids, but with a significant loss of return and in some cases a loss for the carriers.  By granting iPhones a larger subsidy, carriers are in effect trying to enforce their profit margins to the detriment of Androids (and to a lesser extent Windows Phones and Blackberry phones).

If Apple needs to boost its sales, it can always lower prices to the carriers, much like Nokia / Microsoft has tried to do with the Lumia phones.

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