AT&T extends iPhone exclusive in quid pro quo, says analyst

The mobile carrier is alleged to be offering heavily discounted data plans for the iPad in order to keep its iPhone exclusivity deal

AT&T and Apple probably have a quid pro quo in place that has extended the mobile carrier's exclusive deal with the iPhone in exchange for heavily discounted data plan pricing for the iPad, an analyst said today.

"AT&T had to do something dramatic to get the iPad," said Brian Marshall, a Wall Street analyst at BroadPoint AmTech. AT&T's move was to discount its normal wireless data plans by 50 percent to iPad customers.

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As part of the tit-for-tat, AT&T got what it wanted. "For that pricing [on the iPad], AT&T was able to negotiate a six-month extension on the iPhone exclusive," Marshall said.

Most analysts had expected the AT&T-Apple deal to expire this summer, three years after the two companies first partnered on the iPhone. At one time, Marshall was among those who figured that the expiration meant Verizon, the country's largest mobile provider, would also sell the iPhone this year.

He's changed his mind.

Marshall now believes that Verizon won't have the iPhone until the first quarter of 2011. He based his opinion on the failure of Verizon earlier this year to land an exclusive wireless deal with Apple for the latter's iPad media tablet, a move he said numerous sources had told him was a "certainty."

When that didn't happened -- something Marshall said "floored" him -- he began to think there had to be a reason why AT&T landed the iPad and offered such cut-rate deals on its data plans. Thus arose the idea that Apple and AT&T exchanged an extension on the iPhone for lower-priced 3G data plans on the iPad.

"And they're prepaid," he noted, referring to AT&T's willingness to forgo contracts with iPad owners, something it's never done for the iPhone. AT&T offers two iPad data plans, a $15 per month plan for 250MB of data and an unlimited data plan for $30 per month.

Talk of Apple dumping its exclusive deal with AT&T this summer and adding one or more rivals to its U.S. partner list have circulated for some time, and continue to pop up now and again. Two months ago, for instance, rumors that Verizon would get the iPhone drove up the price of Verizon's stock.

AT&T and Apple did not immediately reply to requests seeking comment on a deal to extend their exclusive iPhone contract.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers, and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer or subscribe to Gregg's RSS feed. His e-mail address is gkeizer@ix.netcom.com. Read more about laptops in Computerworld's Laptops Knowledge Center.

This story, "AT&T extends iPhone exclusive in quid pro quo, says analyst" was originally published by Computerworld .

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