When is a five-year deal not a five-year deal?
It feels like just an hour ago that I was lamenting--okay, complaining about--our lack of choice when it comes to which cell networks we can use the iPhone on in the U.S. That lack of options is one of the most frequent questions we get asked by prospective iPhone customers, and one that we've admittedly got relatively little solid information on.
When the first iPhone came out, several sources reported--without on-the-record confirmation--that Apple had a five year exclusive deal with AT&T, presumably meaning that we wouldn't be seeing an iPhone on any other American networks until 2012. Of course, the details of that supposed deal were unknown: did it apply only to the first-generation iPhone? Five years from when? Was it really even five years?
Last week, in a USA Today article about AT&T CEO Randall Stephenson, writer Leslie Cauley made this comment about the deal that Apple struck with AT&T for the iPhone 3G:
In exchange for its payout, AT&T got a year extension, into 2010, on its exclusive distribution deal with Apple, people familiar with the matter say. Sources asked to not be named because the terms are confidential.
That math doesn't seem to gibe with the five-year deal, especially given that the sources say the contract was extended. And, as Apple Gazette points out, what's even odder is that Leslie Cauley was herself one of the people reporting the original deal last year, writing:
AT&T has exclusive U.S. distribution rights for five years--an eternity in the go-go cellphone world. And Apple is barred for that time from developing a version of the iPhone for CDMA wireless networks.
No sources were named for that report either. Now, of course it seems likely that AT&T and Apple renegotiated their contract for the iPhone 3G, so it's possible that wires got crossed in here somewhere. Most importantly, what it tells us is...that we still have no idea just how long AT&T and Apple are locked into an exclusive deal. But an exclusive deal it seems to be, for the present. So if you're waiting for the iPhone to drop on T-Mobile or--even more unlikely--Verizon, I'd advise you not to start camping out just yet.
» posted by ITworld staff
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