Does ATandT's Exclusive iPhone Contract Extend to 2012?

 
 
By Michelle Maisto  |  Posted 2010-05-11
 
 
 

Just how long the Apple iPhone will be exclusive to the AT&T network is again being called into question, as new data suggests the contract length may extend to 2012-a year later than many expected.  

The length of the contract has long been a subject of speculation. In January, preceding the introduction of the Apple iPad, rumors emerged that Apple's big announcement might also include news of an end to AT&T's special status.

Instead, Apple announced that the iPad would feature 3G connectivity, again exclusively in the United States from AT&T.
 
The contract's end-date then shifted to early 2011, particularly following a March 29 report from the Wall Street Journal stating that Apple was at work on two new iPhones, an updated version for AT&T, and a CDMA-based model for Verizon Wireless.
 
In April, Verizon CEO Ivan Seidenberg again cranked the rumor mill, and encouraged thoughts of a not-far-off Verizon iPhone by telling media at a press conference that it was Apple's call whether Verizon got an iPhone, but that "eventually, it's our view we'll get to carrying Apple."
 
On May 11, however, Engadget reported that, following research into old court files, that the original terms of the AT&T agreement with Apple was for a length of five years, putting its expiration date in 2012. On May 21, 2007, prior to the original iPhone launch, USA Today ran a little-acknowledged story announcing the five-year contract.
 
Following a 2007 California class-action lawsuit alleging that AT&T had an illegal monopoly over the iPhone, Engadget reports that Apple pointed to the USA Today article as evidence that the five-year contract was public knowledge.
 
Engadget goes on to report: "Contracts can be canceled, amended, and breached in many ways, and AT&T's spotty recent service history plus the explosion of the iPhone and the mobile market in general have given Apple any number of reasons to revisit the deal."
 
Despite the research, whether the contact has been renegotiated - and the time the two companies needed to work out the iPad agreement might certainly have offered an opportunity - is still unclear. Is the original 2012 date still a go, or can Verizon customers keep hoping for an iPhone when the calendar turns?
 
"It's the sort of thing that people like to talk about over drinks, or read the tea leaves about, but when it comes down to it, we just don't know. At a certain point, it's just guessing," Ken Hyers, an analyst with Technology Business Research, told eWEEK.
 
Agreeing to play the guessing game, Hyers offered, "I was of the camp that this might be the year. If you're Apple, you don't need to tip your hand until the end of the year, because the LTE networks won't be live until the fourth quarter. But again," he emphasized, "nobody knows at this point except for the folks in Cupertino, and a few folks at AT&T."
  

Rocket Fuel