Last week, AT&T said it would drop the price of the iPhone 3GS from US$99 to $49, and Apple is following.The 8GB iPhone 3GS is now available from Apple’s stores for half of its previous price.
The price may have been halved, but you’ll still sign up for a two-year contract with AT&T. This happens just as Verizon is holding a special press event at 11 am (Eastern) tomorrow and is expected to announce that it is now carrying the iPhone in the US.
Although there has been no confirmation from Verizon or Apple that this will happen, all the pundits expect it to. Verizon may sell 13 million iPhones this year, largely because of pent-up demand from existing customers, UBS AG analyst John Hodulik told clients in a note, as reported by “Bloomberg Businessweek” (http://macte.ch/6pc4s).
“It’s going to be the dominant device at Verizon as soon as it’s launched, and, I think, cannibalize the other devices they sell,” the analyst said.
Moving to the country’s largest mobile-phone operator will give Apple the opportunity to sell to the 93.2 million customers at Verizon Wireless, which has heavily promoted phones that run Google’s Android software, notes “Bloomberg Businessweek.” AT&T, the second-largest mobile-phone operator, had 92.8 million customers at the end of September.
AT&T sold 11.1 million iPhones in the first nine months of 2010, putting it on track to sell more than 14 million for the year. Apple gets about $400 per phone, Hodulik estimates. If Verizon sells 13 million units next year, that would give Apple an additional $5.2 billion in sales. Apple’s revenue for the fiscal year ended in September was $65.2 billion.
Meanwhile, analyst Gene Munster with Piper Jaffray said in a note to investors today — as reported by “AppleInsider” (http://www.appleinsider.com) — that he believes the launch of a Verizon iPhone will increase total 2011 U.S. handset sales for Apple by 2.5 million — ore more. The analyst sees AT&T selling 11 million iPhones and Verizon selling nine million this year.
Munster estimates that if the iPhone doesn’t debut on Verizon in 2011, AT&T alone would likely sell 17.5 million of Apple’s handset in the 2011 calendar year. The analyst sees Verizon activating 25 million total smartphones in calendar year 2011. If Apple does indeed account for 9 million, the handset maker would sell 36% of the smartphones on Verizon’s network.
“Reuters” (http://macte.ch/loMJp) is reporting that Verizon Wireless will offer the iPhone to its customers under its existing wireless service price plans, quoting a “source, who asked not to be named as the plan has not yet been announced.” Anagreement between Verizon Wireless and Apple marks the end of AT&T’s iPhone exclusivity. AT&T Inc, the No. 2 U.S. mobile service, has been the only operator to sell iPhone since it launched in 2007.
— Dennis Sellers