Wall Street investors are underestimating the impact of Apple's revenue share agreement with AT&T over its iPhone cellular handset, according to one industry analyst. Researcher Gene Munster of Piper Jaffray has constructed a model of what he believes reflects the true impact of the iPhone and AT&T revenue share in the coming years. The model assumes iPhone average selling prices of $399 currently with $300 average selling prices in the future; those figures bring Apple $18 per subscription per month today and will fall to $9 per subscription per month by the end of calendar year 2009, according to Munster. Piper Jaffray raised its price target on Apple shares to $250 from $222, and maintained its 'Outperform' rating.

"Based on this model, we continue to believe that the iPhone and the revenue share agreement will be more impactful in '09 and beyond than currently factored into consensus thinking," the analyst wrote in a research note obtained by MacNN.

The model assumes Apple will sell 3.4 million iPhones in 2007, 12.9 million in 2008, and 45 million in 2009.

"While our calendar year 2007 and calendar year 2008 estimates are in-line with general Street thinking, calendar year 2009 units of 45.0 million is based on our belief that iPhone average selling prices will continue to decline over the next two years," Munster said. "Specifically, we assume iPhone average selling prices fall from $400 currently to $370 by the end of calendar year 2008 and to $300 by the end of calendar year 2009."

Based on data from Apple's September quarter, the company's current revenue sharing agreement with AT&T requires a share payment of $18 per subscription per month -- which is materially higher than the analyst's original expectation of around $6.50 per subscription per month.

"We are taking a conservative approach to the revenue share agreement and assuming that by the end of calendar year 2009 the monthly payment to Apple will be $9.00 per subscription per month."