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iPhone revenues to dominate Apple Q4

updated 09:20 am EDT, Wed October 17, 2007

Unlocked iPhones

Analysis firm Pipper Jaffray believes that Apple will be missing a marginal amount of revenue from the sale of unlocked iPhones when it reports quarterly results for its fourth (September) quarter on October 22nd. A Piper Jaffray report estimates that Apple sold 1.05 million iPhones in the September quarter (for a total to date of 1.32m including June), and further speculates that Apple receives $3/month for every AT&T subscriber that buys an iPhone, and $11/month for every non-AT&T subscriber who purchases an iPhone (with AT&T service) over the life of the 24 month contract. Hence the firm estimates that Apple will report AT&T revenue share of $10.6 million for the September and June quarters combined.

The firm also believes that somewhere between 5 percent and 10 percent of the iPhones sold in the September quarter were sold to be unlocked and used with wireless carriers other than AT&T. They go on to postulate that if 5 percent of iPhones sold in September 2007 were unlocked (53,000 in total) the total revenue would be reduced by $330,000. "Ultimately," said the report "it is clear that the iPhone unlocking does not have a meaningful financial impact, but it has the potential to cut significantly into the revenue sharing income if iPhone unlocking becomes rampant. That said, we believe Apple is working to disable unlocked phones so that the problem does not become widespread."

Users can now unlock iPhones running the latest v1.1.1 firmware, despite warnings from Apple that its v1.1.1 update would likely damage (i.e., "brick") phones that were unlocked to run on non-AT&T networks. Following the public release of the first "jail-break" hack for iPhone v1.1.1, iPhoneSimFree has released an updated version of its unlock software for v1.1.1 users that not only works with the v1.1.1 firmware but also can restore "bricked" iPhones, according to the team.

by MacNN Staff




  1. testudo

    Joined: Dec 1969


    I'm sorry

    But Apple's quarterly revenues are in the realms of $6 billion, are they not? How exactly does $10 million constitute "domination"? Even the hardware sales (being that they are spread out over a period of time) will be like $20 million (assuming Apple even tells us how much they account for).

    I think the headline is slightly stretching things.

  1. bobolicious

    Joined: Dec 1969


    I would buy an unlocked.. in a heartbeat - and apple would only gain as there is no AT&T where I live...

    Is it is more about equity in leveraging such revenue obligations across the industry...?

  1. testudo

    Joined: Dec 1969


    Re: I would buy... in a heartbeat - and apple would only gain as there is no AT&T where I live...

    What? You haven't moved to someplace where an iPhone would work? I think someone's Apple-fan-club membership card needs to be revoked.

  1. Jonathan-Tanya

    Joined: Dec 1969


    flawed logic

    The analyst believe there are a finite amount of iPhones and that if the iPhones hadn't been unlocked, they would have resulted in a new AT&T customer. I doubt his speculation is correct. If the phone hadn't been unlocked, there just wouldn't have been a sale, in most cases. All that is happening here, is Apple is making additional sales & profit, on phones.

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