From MarketWatch’s “The 5G iPhone is reigniting the subsidy wars, which is good for Apple and consumers but not mobile carriers” posted Thursday:
Wireless carriers, eager to capitalize on the opportunity and avoid getting shown up by their rivals, are heaping on the promotions to both attract new customers and retain existing ones.
“If someone is willing to pay you $800 for a phone that’s worth $100, that’s a pretty good deal for a consumer and for Apple, but it will obviously impact the balance sheet for the wireless carrier,” LightShed Partners analyst Walter Piecyk told MarketWatch. The $800 subsidy is the largest he’s seen on an iPhone launch day…
Wireless deals of this nature typically only occur “late in an iPhone’s life cycle,” wrote Wolfe Research analyst Jeff Kvaal, who agreed that the carrier subsidies could help give iPhone 12 sales an early lift. The deals “may balance an uninspired 5G value proposition that Apple’s examples (mobile gaming, remote MRIs) did little to counter,” he continued.
My take: The carriers need Apple more than Apple needs them.