[IP] Re: About the Dark Side

[David Farber <dfarber@cs.cmu.edu>]

Begin forwarded message:

From: Lauren Weinstein <lauren@vortex.com>
Date: September 30, 2007 12:33:20 PM EDT
To: Ole Jacobsen <ole@cisco.com>
Cc: Lauren Weinstein <lauren@vortex.com>, Dave Farber <dave@farber.net>
Subject: Re: About the Dark Side


> Here is the part I don't understand: In many parts of the world the
> sale of "cool" replacement ('upgrade') handsets is Big Buiness. While
> having AT&T as the exclusive provide in the US might be a good way
> for Apple to get started in the handset business, why can't they just
> SELL THE PHONE at a premium to folks who are willing to pay. Surely
> this would sell a lot more iPhones at the end of the day?

Ole,

Thanks.  I suspect the main issue is that the carriers got
themselves into the box early on of subsidizing phones tied to
contracts, and now there's no effective way out in terms of the mass
market.  People are used to cheap phones, and only specialized users
(business users, other power users, heavy e-mail users, etc.) will
pay for more expensive phones, and even they usually expect it to be
partly subsidized at least -- with the iPhone being a notable
exception.  I don't see the iPhone model becoming the standard though --
I suspect it's an aberration in the normal subsidization model that
we won't see repeated on that scale very frequently.  We'll see over
time.

--Lauren--
Lauren Weinstein
lauren@vortex.com or lauren@pfir.org
Tel: +1 (818) 225-2800
http://www.pfir.org/lauren
Co-Founder, PFIR
   - People For Internet Responsibility - http://www.pfir.org
Founder, PRIVACY Forum - http://www.vortex.com
Member, ACM Committee on Computers and Public Policy
Lauren's Blog: http://lauren.vortex.com



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