Apple should ditch AT&T as its exclusive iPhone operator and follow a multi-network approach everywhere, according to new analyst thinking. Why? Apple will more than double its market share.
Kathryn Huberty at Morgan Stanley did the research--and the figures are impressive across the board. The takeaway: If Apple abandons AT&T exclusivity, it's likely to push its U.S. cellphone market share from 4.9% today to 12.2%. That's nearly triple. The move would turn Apple from the golden child of cellphone technology into one of the major market dominators in the country.
But the iPhone is a global phenomenon--something detractors forget. Only 54% of iPhone users live in the U.S., and that figure will shrink when the phone hits China. Huberty notes that although Apple pursues a multi-carrier model in many nations, almost 70% of iPhone shipments in the second quarter of this year went to six markets that still have exclusive network deals. If Apple changed its strategy for these nations too, the average iPhone market share around the world could more than double from 4% to 10%.
That's an astonishing figure, considering Apple sells just two basic varieties of the device. Going for a single-carrier model has made sense in many places for good reasons--it generates a lot of local excitement, and no-doubt lets Apple make the operators bend to its will. But it makes less sense now that the phone's established. And to double marketshare? Think of all that cash income. Not that cash is too much of an issue--recent AdMob figures show that Apple has now captured 40% of the global mobile browser market share, pushing Nokia (the world's biggest cellphone maker) into second place with 34%.
Sticking to a single U.S. operator makes zero sense. There's a string of bad press on the web from the AT&T-Apple alliance, and that colors the device's global PR. An Apple slip-up recently revealed that a 30% dropped call rate was perfectly normal for iPhones on AT&T--a shocking admission of the network's fallibility. AT&T also dropped the ball on data tethering and MMS, already available in other countries--even Portugal, western Europe's poorest nation--and embarrassed Apple, which had announced those capabilities months earlier. With the next-gen iPhone only eight months away, and a rumored 3G-capable tablet on the cards in early 2010, it's time for Apple to change its relationship with its U.S. partner.