Report: Over a quarter of all iPhones were unlocked

Analyst reports circulating in the news today indicate that about a million iPhones have been unlocked to operate on networks other than AT&T -- and that's said to be roughly 27% of all the iPhones sold in 2007. If accurate, the news is not good for Apple: the company earns significantly more when a new iPhone user signs up for service with AT&T. Link. So where are all those unlocked iPhones? This post by Damon Darlin on the NYT's tech blog gathers first-person accounts by folks overseas who weigh in. (Thanks, Adam)

[#1 posted by RyanH , January 29, 2008 9:05 PM]

This says that it is not good news for Apple, but I can hardly see it as bad news. Perhaps less than optimal is the best way to put it. After all, they still get the sale at a profit. They get another customer. Larger percentage of the market = more brand recognition.

Also, when their exclusive with AT&T ends, having millions of iPhones already working on other networks is going to create a lot of incentive for those networks to play nice with Apple to provide the most service. After all, who wants to be the only network that DOESN'T support the iPhone?

[#2 posted by daveon , January 30, 2008 12:49 AM]

Part of the way that Apple has sold their value proposition to the markets has been through revenue shares with the Operators for the data revenues from the iPhone. Without that then the iPhone has to purely make money based on margins which is a tricky proposition.

After all, who wants to be the only network that DOESN'T support the iPhone?

Probably most of them, at least if they have to give away core revenues to Apple. Look at China Mobile.

The iPhone has sold well as devices go, but the operators will generally be more interested in the tens of millions of other units a month they ship, especially in Europe.

The iPhone is seriously cool, but I still think Apple have read this one wrong and are going to get punished by the market for it. If, in fact, looking at the share price, it hasn't already started to happen.

[#3 posted by Clif Marsiglio , January 30, 2008 4:28 AM]

I've talked with several of my friends from Apple over this, and not one has said anything negative about unlocking. They claim that legally, they have to 'visibly' demonstrate they are protecting the investments of the phone companies...all have iPhones and funny, the one I talk to the most I don't get my 'Mobile To Mobile' minutes because he is on another company.

Then again, one of these friends in the iPod division was also the one that told me the dead simple secret for removing the DRM from iTunes purchases and I've never once heard it used elsewhere (maybe those that knew the secret kept their mouth shut...like I'm gonna do...worked on iPods up to he 3rd gen...I kept my original around to do this until the iTunes+ came out and now I only buy DRM-Free stuff anyways).

So I don't think Apple is really hurting over this. More to the point, I think it barely registers anywhere except legal...

[#4 posted by James David , January 30, 2008 6:27 AM]

While we're on the topic of iPhone numbers, did anyone catch this article on Slashdot about the "missing" iPhones? It seems very unlikely and the reporting is pretty shaky... speculative rumor?