Just ahead of the big news day from Apple (NSDQ: AAPL), one more piece fell into place in the distribution game, it seems. A report emerged that Sprint (NYSE: S), too, will be added to the list of those carriers in the U.S. that will sell the iPhone. What’s more, another report notes that, in fact, Sprint will get more than just a CDMA version of the device…
According to the WSJ, Sprint has committed to buy at least 30.5 million iPhones, which would work out to some $20 billion in devices that it hopes to shift over the next four years, in what an anonymous informer in the story referred to as a “back the company kind of thing.” The report said that when Sprint CEO Dan Hesse pitched the idea to his board he noted the company would probably lose money on the deal until 2014.
But that’s not all. A separate report in BGR claims that not only will Sprint be added to Apple’s list with an iPhone 4S product, but it will be the exclusive distributor of the iPhone 5. The device, which will be equipped to work on Sprint’s faster WiMax network, will be shipped only with Sprint until 2012. At that point, the other operators offering the iPhone, AT&T (NYSE: T) and Verizon, will get LTE versions of the dual-mode device as well.
Update: One more unconfirmed report to throw into the fire. A separate post from the WSJ today says that there won’t be a “4G” version of the iPhone 5 after all, and that it will simply work on the 3G networks more commonly available today. That means no WiMax iPhone and no LTE iPhone for now.
We should know later today if these reports are accurate — at least in terms of Sprint getting the devices, if not the actual financial hoops it had to jump through to do so. If they are, a few things stand out about this story:
– Sprint may be happy with the Android devices in its portfolio –among them,
it is the sole distributor of the Nexus S, Google’s own Android device — but perhaps not happy enough. Hesse noted at an industry conference last month that Sprint’s lack of the iPhone was the “number-one reason people leave” Sprint.
– It’s crazy that the operator will be losing money on the device until 2014. That makes it sound like a big gamble… unless it can convince users to take premium data plans along with the devices.
The fact that there have been other reports noting that Sprint will continue to offer unlimited data plans, even as its competitors turn to metered offerings, points to how it will hope to differentiate its iPhone from other carriers’ iPhones.
A report we covered yesterday noted that the majority of iPhone users tend to return to their incumbent provider. If accurate, this wouldn’t work in Sprint’s favor, except that it might be able to steal a march on all those people who aren’t yet iPhone users (the majority in the U.S. are not) and lock them in to Sprint.
– T-Mobile looks increasingly like it might be left out in the cold with these latest developments, being the last of the big U.S. carriers not carrying the iPhone. Roll on, AT&T merger.