Wednesday, April 15, 2009

AT&T Seeks To Extend iPhone Exclusivity Deal Until 2011

. Wednesday, April 15, 2009

By stockOzone team

US telecom giant AT&T Inc. (NYSE: T) is reportedly seeking to extend until 2011 the exclusivity deal with Apple which is expected to expire in 2010. The Wall Street Journal reported that AT&T CEO Randall Stephenson is engaged in discussions with iPhone maker Apple to extend their agreement.

An Apple spokeswoman declined to comment, saying only, "We have a great relationship with AT&T. Stephenson to refused to discuss the terms of AT&T's agreement with Apple beyond saying it was a multi-year deal.

AT&T could not simply think in terms of losing iPhone exclusivity agreement as it has brought in millions of new customers for the carrier. Apple has sold more than 17 million iPhones since its debut less than two years ago, and the carrier added 4.3 million iPhone subscribers in the second half of 2008--40 percent of whom were new to AT&T.

However, for Apple, extending the exclusive agreement with AT&T seems less advantageous as offering the iPhone through more carriers would increase the number of devices sold.

It seems that Wall street is largely split over what Apple might do about extending the arrangement. No doubt, there is a consensus among analysts that an extension would certainly benefit AT&T.

Disclosure: Author does not own any of the stocks discussed here.





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