Quote:
Originally Posted by murraypaul
I don't see anything in the article which says that, overall, Verizon is looking money on iPhone customers.
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I will try to make it clearer for you with a little cut and paste from the article.
The underlines are mine. The
italics is from the article.
First there is a growth in customers which is why I said, they were trying to make up for their losses with volume.
"Some are obvious. The device's ability to win over new customers and retain existing ones has been proven over and over."
The problems are with their profit margins. I cut out some pertinent parts for you.
"Others aren't so optimistic. Morgan Stanley analyst Simon Flannery said he expects average revenue per user growth to slow for the wireless carriers. Beyond data, the companies face pressure from shrinking revenue on the voice and text message side of the business. "
"AT&T's results over the past few years illustrate Moffett's concerns. Since getting the iPhone and moving to a subsidy model, the company has seen lower margins, he said. Its fourth-quarter wireless margins dropped by a third from a year ago. "
"All of that came at a cost. After taking out one-time items such as pension-related costs, the company [[Verizon]] earned 52 cents a share, two cents shy of Wall Street expectations. Excluding income tax, depreciation and amortization, earnings fell 1.1 percent from its year-earlier period. A year ago, when Verizon didn't have the iPhone, it saw 5.5 percent growth."
"Verizon, however, was upbeat about the customer growth driven by the iPhone, acknowledging that margins would fluctuate in the next few quarters."
"The carriers, meanwhile, are falling over themselves paying for the privilege of selling the iPhone. While everyone is lauding Apple for its blowout quarter, no one's getting excited for the carriers' financial performance. "
I guess while membership has its priviledges, with the Apple iPhone you pay through the nose too.