Are one in three iPhones sold being unlocked?
By Donald Melanson 
posted Jan 25th 2008 11:28AM
posted Jan 25th 2008 11:28AM
While it likely won't come as much of a surprise to those reading this, it seems that Apple's recently released iPhone sales numbers and AT&T's customer number don't exactly match up, leading those ever so insightful analysts to conclude that many of the phones are being sold with the sole intention of being unlocked. What is somewhat surprising, however, is exactly how many phones that might be. As MacWorld reports, Apple says it sold 3.7 million iPhones in 2007, while AT&T says it signed up about two million or so iPhone customers during the same time period. While those aforementioned analysts point out that Apple's numbers were boosted by 300,000-400,000 sales in Europe, and likely a few sold over the holidays that were yet to be activated, that still leaves over a million iPhones running free out there. If you do the math, that seems to suggest that roughly one in three iPhones sold are being unlocked although, obviously, we're not about to get a confirmation on that number from anyone.
maybe, who wants to know?
yeah, I agree. Who the hell cares?
What about people who already had an AT&T account? They signed up 2 million iPhone customers, but I bet that close to a million already had an AT&T account and just added the iPhone data plan.
Or maybe 1 million are lying on AT&T, O2, T-Mobile and Orange shelves, waiting to be discounted. Can anyone say inventory build-up?
http://www.itwire.com/content/view/16278/1023/
Two of those are in India, i sent them unlocked...
Once again, Engadget's dedication to excellence [read: Apple] is astounding. I guess they have to meet a quota and have at least one article about Apple on the front page at all times to get that dirty money from Stevey. What about the amount of other phones that are being unlocked...never hear about those.
i'll confirm it for you then.
all of my buddies phones are unlocked.
:)
*giggles quietly while reading this on his unlocked iPhone*
Apple sold approximately 4 million (3.7M + 400k) iPhones.
1 million not registered with AT&T.
My elementary school algebra says that
1million / 4million
is
ONE IN FOUR - not one in three as claimed by Engadget.
A quarter of iPhones are not with AT&T - lucky fellows!
Recently AT&T CHARGED me for using the EDGE network - was it not supposed to be free?
I am now restricted to my college's WiFi only and NO EDGE - iPhone will surely lose the edge when Nokia N95 with S60 comes out with FULL INTERNET WITH FLASH - unlike the iPhone's BABY INTERNET.
I used to be a Macintosh Addict. I went to Rehab after the MacWorld!
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.
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Is it also possible that some accounts have two or more phones associated with them as in a family plan or a small business that gives out one to every sales person and manager.
Can someone explain to me the logic of making iPHONES exclusively for AT&T?
Did they get some kind of multi million dollar kickback?
What rock did you just crawl out from under?
I'd like someone to explain this to me too, flashpoint. Many of us only casually follow what Apple does, while others hang on every word.
Seriously, Google it. The information is all out there.
@Jay
Yes, there is a kickback from AT&T to Apple for each phone sold.
Actually not for each phone sold. the estimates are that Apple gets $10 a month for the duration of the contract for activated phones.
Umm count me in too on wanting to know WHY!?
I've tried looking it up and I can't find anything.
So again I ask why the hell is the iPhone exclusive to AT&T?
And why is everyone so amped about this 3G iPhone when apparently both Verizon and Apple are working on 4G phones that will come out in 2009 or something?
It's a pretty smart move on Apple's part, actually. First of all, it creates a demand through exclusivity; if everyone has one, it's not as hyped. Also, Apple, a computer company, probably doesn't have much experience with the workings of the telecom industry, so learning the basics from one company is much easier than dealing with the huge number of wireless companies out there. Also, think of the shift in liability with the iPhone. Usually, when people's phones break, they take them to the wireless store to get them fixed. With the iPhone, Apple is well-known as the makers, so they would be dealing with customer service from every wireless company out there instead of just AT&T's customers.
Learn how to use Google!
http://www.usatoday.com/tech/wireless/2007-05-21-at&t-iphone_N.htm
http://www.everythingicafe.com/news/iphone-hardware/att-holds-five-year-distribution-deal-on-iphone-20070522151/
http://blog.wired.com/cultofmac/2007/05/apples_5year_de.html
I could be wrong, but I could swear that someone ran the #'s and found that Apple makes another 300-400$ from AT&T on top of what they are getting from the sales themselves. So yes, there is a massive kick-back.
Also, AT&T gave the iPhone support for the visual voice-mail setup that they have going which, from what I understand, is a big selling point for a lot of people.
Also Apple "needed" network help in order to bring Visual Voicemail. Now whether that is truly the main reason, who knows.
But seriously, this stuff has been engadget headlines before. you don't have to dig deep.
Im buying one tonight actually. Don't even think I can unlock it if I get a 1.1.3.
i know three people who have them iPhone .
did i forgot to mention that i am from india ?
See that all you iPhone unlockers - there are over a million others. You are not smart, you are not elite, you are not a hacker. These people withe the unlocked iPhone think they are always getting away with something and that they are the coolest guy in the room because they unlocked their iPhone. It's mainstream now.
Jealous your Mommy wouldn't buy you an iPhone?
Get over it.
LOL @ Brad
Oh my god... tell me you didn't pay to get out of a cell phone contract to switch to AT&T for the iPhone... cuz that's the kind of bitterness I taste from your post! Sucker!
I remember when the iPhone was first available and it was known that the sim can be hacked. There were two dozen Asians (possibly Indian) buying 3 or more iPhones each in cash repeatedly, and all 20+ of them would meet outside and give it to their "leader" who had a van. That's where the other millions went.
Then, at some point, management at the Apple Store 5th avenue started shouting out that they will no longer accept Gift Cards for the iPhones or cash. Only credit card. or something like that.
@Brad
locked or unlocked i think everyone with a iPhone thinks there the coolest person in the room.
We are! :)
hahaha good one are you a comedian??
Hey, I represent tat remark!
Phew! Thank god you didn't resent it!
I would think either Apple or AT&T would be able to compare a list of serial numbers sold versus serial numbers activated, and come up with a pretty precise number of unlocked phones. I bet they're watching this closely.
My phone is unlocked, the data plans on T-Mobile here in the US are a whole lot cheaper. I pay $20/mo for unlimited data, plus, any phone works with myFaves, since the plan is linked to the phone number, not the application on the phone.
I don't consider myself "elite" for having an unlocked iPhone, but I consider myself a smart consumer for doing so.
Forgot to add, the funniest part was when I went to the local AT&T store to purchase a case for the iPhone (same store where I bought the phone) and got into a conversation with the AT&T salesperson about my unlocked iPhone, why I did it, etc, even showing her the iPhone itself with third party apps, running on T-Mo, etc. She (and others) seemed genuinely interested in the whole process and not once was I shunned by the staff for doing what I did. That's the reaction that surprised me the most.
I also have T-Mobile and wouldn't have bought one if I had to pay Ma Bell.
However I'm only paying $6 for the T-Zones unlimited plan and it's not any different than the $20 web plan. I did have to add one extra APN file that took a whole five extra minutes.
I guess that makes me an even smarter consumer. ;)
They probably didn't want to push you away from buying their overprice high-markup cases!
@ Scott: The $20 plan is a "Total Internet Add-On" which is for data devices (formerly my Treo 650, ironically also unlicked from Cingular) and also provides me unlimited T-mobile HotSpot Wi-Fi access as well... still a great bargain IMO.
sooo..I guess you use the cheapest t-mobile plan with my faves: 39.99, and then you have an unlimited data plan, which you say is 20 a month, though I don't see anything like that on the website... so that means you pay 60 a month for 300 minutes, my faves, internet, no warranty, and no updates... and the cheapest AT&T plan is 60 a month, with 450 minutes, unlimited internet, a warranty from Apple, and guaranteed extremely useful software updates... I'm sorry, maybe I'm stupid but how exactly do you think that's a good deal? I personally haven't found a third party app that I think is worth unlocking my iPhone for. Haha, but whatever suits you I guess...
@ DrAnonymouse:
Yes, My rate is the $39.99 MyFaves. 90% of all my minutes go to those five people anyways, so the 300 whenever minutes are never exceeded. My internet is at $20 grandfathered at the old rate (now $30) and I get corporate discounts through the Navy. (until just recently, these obviously weren't offered). So, after fees and everything, I am paying roughly $65/month.
For me to switch to AT&T, I would have to cancel my T-Mobile account, costing me a $175 termination fee, and apply for an AT&T account ($200 deposit plus applicable application fees). and I get 450 minutes. I use more minutes than that in a month, but since it's limited to the five people, The T-Mobile plan makes more sense.
Warranties are practically useless to me, since I habitually take care of my electronics anyways.
Also, AT&T currently does not offer the inclusion of WiFi with their iPhone plans, whereas T-Mobile does. This is a big factor when i travel.
Updates? I have 1.1.2 right now. Granted, i have to wait for the open source community to create the workaround, but I still get the updates.
And the number one factor: customer service. AT&T is consistently ranked among the lowest (if not the lowest) for customer service. On the other hand, T-Mobile is on the opposite end, being among the top (or being the top) in customer service.
And finally, what was the point of your post, were you trying to make me feel guilty for doing what I did? Because I can guarantee you that anyone who has gone the path of unlocking and using the iPhone on another carrier feels absolutely no guilt for doing so, or else they would simply be AT&T customers and not know any different.
This just goes to show Apple chose the wrong biz mode on this one!
If they because a phone supplier to any network that can handle the technology (damn you Sprint CDMA) they would have hit their 10 million unit mark already!
Too bad they decided a piece of the subscriber pie was the way to go...so sad for you APPL!
Over 4 Million sold, but how many actually activated on the blue n white "death star" network? Anyone care to a guess at a number? I'll take the first crack at it:
- 1.4 mil?
next...
....I hope you meant AT&T. Why the hell would Apple have a problem with people buying their product? Regardless of whether the phones have been activated or not, it's still a sale for Apple.
I fail to see how Apple's business model is flawed. Sounds like Apple is getting money either way and while they'll get a little less form unlocked phones, AT&T is hurting more so than Apple. Remember, AT&T worked with Apple to developer some items like visual voice mail so any phone sold that goes onto another network is less money in AT&T's pocket.
...and I need to learn to proof before I click submit...
Seems to me that Apple was the smart one in this deal because they are (and will be) selling their phones. It's AT&T that gets the short end of the stick... You'd think they would have guessed this.
Exactly! Apple whispered sweet nothings, and AT&T bent over to take it.
How is AT&T getting the short end of the stick here? They didn't "sell themselves out" or "take a chance" here, they made a good business decision... they KNEW Apple fans would pay ANYTHING to get one of these, and get a few other curious people who desperately need what they think is the new "it" thing. So what do they do... they overprice a service plan for the iPhone, kick $10 back to APPL and there you have it, AT&T gets a bunch of new customers into expensive contracts (which they'll have for at least 2 years), and exclusively landed the "hot, new phone" and appear to be on the cutting edge because of it. Jobs and Apple didn't trick anyone. They just took the best offer.
1. are you asking ot telling?
2. blogger alert!!! "...obviously, we're not about to get a confirmation on that number from anyone."
3. every headline that ends with a question mark is just lame.
Sneaky bastards.
Besides myself, I know 5 other iPhone users. Three of them have their iPhones unlocked and jailbreaked to the max. My wife and I remain humble and lowly AT&T users. So, I'm not at all surprised to see such figures.
What only 300k-400k iPhones sold in Europe over 2 months in the three wealthy and highly populated countries of the EU. That really looks like poor level of sales.
we're still waiting for the 1.1.2 4.6 OTB unlock! by then, you'll see the number escalate even higher :)
There's also the posibility that there is a whole crop-ton of iPhones sitting in AT&T stores and warehouses. These would be sales to Apple, since they've been sold to AT&T, but as AT&T hasn't pawned them off on consumers, they've yet to be activated.
Or someone's lying about their numbers.
Shameless self-promotion! BOOOOOOO!
Hey, be nice. It's a non-advertising site. There's no profit motive here!
If you look at the analyst numbers, it becomes clear that channel stuffing by Apple is unlikely. In the US, there are only two vendors: AT&T, and Apple. With the number of locations, each venue would have to have about 150 phones in inventory each. That's highly unlikely, mainly due to space concerns. 150 iPhones may not sound like a lot, but there's only so much inventory space.
Also, that mass of phones (about 1.3 million) would show up in Apple's receivables and the AT&T/Apple store inventory numbers. Apparently they do not. They're unlocked.
Apple just needed to make unlocking hard, but not too hard. They make money off the iPhone and the service, but they'll be happy to make money off just the iPhone as well.
now i've seen drop ship suppliers in hong kong selling completely unlocked iphones.
what i want to know is whether these iphones once started out being locked, and were unlocked by the drop ship company, or whether apple is supplying some unlocked iphones internationally?
for me.. 1 of the 3 iphones that i bought is locked.. other two are unlocked and are being used by my family in Nepal.
I'm sure there's more than a couple being sold on eBay!
2/3.7 approximately equals what, now?
I did see a lot of domains with variants of smashmyiphone in them.
Also, this article doesn;t take into account that there maybe many iPhone users that unlocked tehir iPhone because they want to use other applications, but are comofortable with AT&T.
M
jailbreaking and unlocking are two different things. You jailbreak to install third party apps and unlock to use a different carrier. Mmkay?
But this was obvious. I personally bought 17 iphones, out of which exactly ONE (mine) was activated with AT&T (and also unlocked and jailbroken). The rest were unlocked and taken to Spain, some for my family, some sold on ebay Spain (for a healthy profit). I would be shocked if there weren't people doing that at an industrial scale, taking hundreds or thousands of iphones to countries where it is not available. Heck, I saw yesterday a merchant offering them in NY's Chinatown, $625 unlocked.
I believe this is Apple's way of getting it both ways. They get a piece of the AT&T revenue AND they get to sell a bunch of "unlocked" phones. Wouldn't be surprised if they were secretly rejoicing. The other alternative business model would have been selling unlocked phones everywhere, so I believe this way they get AT&T money on top of it, without losing that much of the unlocked market, since whoever really wants an unlocked iphone can easily get one.
As we should all know by now, Apple is an expert on getting it both ways...
Most Apple stores have cracked down now on people buying iPhones for resale. I think they are limiting 3 per person. Since there is no cash sales of the iphone it is a bit harder to buy more than one without them noticing.
They do now. But they didn't when I bought my 17 (last october/november, before 1.1.2 came about). In fact, I remember while buying 2 at the Apple Store in Salem (NH, which has no sales tax), that some guy showed up, and the person who was helping me told me: "this guy comes and buys 5 iphones with cash every day". I wonder where all those iphones went :-)
I believe that since 1.1.2 can't be unlocked yet, they have relaxed their policies a bit, and I am sure that if you really insist on buying 4 or paying cash they'll let you.
When i was back in Asia this winter went to various phone stores and all their iPhones came from the US and are unlocked... so....
Much ado about nothing. The difference is likely due to existing AT&T customers who switched to the iPhone vs new customers activating an acount.
It says, activated phones, not new subscribers. Even if you were already an AT&T subscriber, you still have to activate the phone to use it on their network.
No they can't. Cash is legal tender
http://en.wikipedia.org/wiki/Legal_tender#In_the_United_States
Did you even read what you linked to? Geez...
"There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise."
AT&T is just using the same math when they calculate your monthly minutes. They always come up short.
How many don't work and cannot be activated becasue they are tied-up with Apple support?
Hmm.... I sold like 60 unlocked phone on eBay, and I know plenty of people who did much better then me. So I wouldn't be surprised if the figures are even higher. Also count for those who are with ATT but unlocked the phone in order to get the applications and travel abroad without stupid roaming charges!
To me it's ridiculous in the mobile phone industry to have phones which are exclusive to one provider. Imagine if you went to buy a TV and they told you it would only work with Viacom-owned channels. Or if your internet service provider said it would only work on Dell computers. You'd be, rightfully, outraged. Yet it's considered acceptable for service providers and manufacturers to collude when it comes to mobile phones.
What does that tell you, AT&T and Apple? We don't want to sign up with AT&T just to use your service, we want the damn iPhone and we'll do whatever we can to make it work on our service.
It's not even about AT&T.
What do these places have in common:
India, population 1.1Bn+
China, population 1.3Bn+
Japan, population 127M+
Europe without France, UK and Germany, pop 200M+
Russia, eastern europe, south east asia
Africa
South America
In all these places, the iPhone is not available officially from Apple. All these places have to buy unlocked phones. It's the VAST MAJORITY of the world's population. This is not about AT&T, it's about the iPhone simply not for sale there.
It's not even about AT&T.
What do these places have in common:
India, population 1.1Bn+
China, population 1.3Bn+
Japan, population 127M+
Europe without France, UK and Germany, pop 200M+
Russia, eastern europe, south east asia
Africa
South America
In all these places, the iPhone is not available officially from Apple. All these places have to buy unlocked phones. It's the VAST MAJORITY of the world's population. This is not about AT&T, it's about the iPhone simply not for sale there.
Duh. The world is a big place and Apple doesn't officially sell the iPhone anywhere but a handful of select places.
The rest of us gets unlocked phones.
Can you imagine how the sales numbers would explode if Apple just sold it to everyone who wants to buy it? My God...
Maybe these numbers will be a lesson to them in the future.
In all seriousness, any carrier evaluating the benefits of such a deal, and any device manufacturer weighing the actual benefits of an exclusive agreement will have to look at these numbers.
It also shows just how much people believe that their hardware is actually theirs.
I was just down in Mexico where iphones were everywhere. Every single one of them was unlocked. When I asked around in a store that was selling them the vendor said that he had bought almost 1000 iphones, had sold them all at $600 apiece and was getting in a new shippment of 1000 because his first had sold out so quickly. The've become a huge status symbol. This is happening in cities all over Mexico and I'm sure many other countries as well. My bet is those phones are not just sitting in the channel somewhere.
...and then you have guys like me who bought the iPhone, found out AT&T service in your area blew donkey balls, tried to get a refund on day 15 only to learn you got owned on day 14, and decided to keep it because it has the most elegant calendar of all smartphones on the market.
In Cyprus apple hasnt given anybody the rights to the iphone yet hundreds of ppl have hacked versions brought from America
i bought mine unlocked in a shop in hk. i asked them how well they sell and they said that they could sell about 10 units a day on the average. and that's just one shop in an entire building whose shops sells iphones. so we can say atleast a couple of thousand there.
I'd say Apple is cooking the books! There's no way one in three iPhones is unlocked...
I'd say Apple is cooking the books! There's no way one in three iPhones is unlocked...
I'd say Apple is cooking the books! There's no way one in three iPhones is unlocked...