Will the iPhone 5 Be Exclusive to Sprint?
Tomorrow at 1 Eastern/10 Pacific, The Motley Fool's top analysts will be hosting a live blog breaking down what Apple's iPhone 5 press conference means for investors. The best part? They'll also be taking any questions you have about the phone and Apple as an investment as well. Make sure to set a reminder to come back to Fool.com this Tuesday for all your iPhone 5 news and analysis!
The last-minute rumblings and rumors are coming in ahead of Apple's (NAS: AAPL) iPhone 5 announcement tomorrow, and this is a juicy one.
TheWall Street Journal is reporting that Sprint Nextel (NYS: S) is making a huge bet on the iPhone 5. According to the report, Sprint would be committing to purchasing 30.5 million iPhones over the next four years -- a $20 billion commitment -- regardless of whether it could find enough users for the devices. Such a commitment would probably be unprofitable until 2014, according to the report. Sprint CEO Dan Hesse has previously said that missing out on the iPhone is "the No. 1 reason customers leave or switch."
Additionally -- and more interestingly -- BGR independently reported that that an "incredibly solid industry contact" has disclosed that Sprint will be the exclusive carrier of the iPhone 5. Keyword: exclusive. Exclusivity did wonders for AT&T (NYS: T) during the iPhone's formative years, and if the BGR report turns out to be true, it could truly turn the tables in favor of Sprint for the foreseeable future.
It's widely believed that Apple will be introducing at least two separate models tomorrow: a redesigned iPhone 5 and an upgraded version of the iPhone 4, dubbed the iPhone 4S. TheBGR report alleges that the redesigned iPhone 5 will be available only on Sprint and will feature 4G WiMAX, while AT&T and Verizon (NYS: VZ) will be relegated to carrying only the iPhone 4S. The article goes on to mention that near-field communications, or NFC, will be also included.
As riveting as this would be, I don't believe it. At this point, Apple has plenty of leverage with carriers, and an exclusive deal with a carrier smaller than its current two domestic partners makes little to no sense.
It's believable that Sprint is committing a ton of money into getting the iPhone, but exclusivity isn't the name of the game for Apple anymore. More carriers mean more household penetration and iPhone sales, and vice versa. Google's (NAS: GOOG) Android pulled ahead in market-share in part because of wide availability among all wireless carriers.
WiMAX has lost the 4G battle to LTE, and NFC is too immature to be a meaningful addition. I've already made my official predictions of what will be in the iPhone 5, with 4G and NFC waiting until next year.
Now is the time to wrap up your iPhone 5 predictions, for all will be known tomorrow. Just don't forget to check back for all our Foolish coverage. You can start by adding Apple to your Watchlist.
At the time this article was published Fool contributorEvan Niuowns shares of AT&T and Apple, but he holds no other position in any company mentioned. Check out hisholdings and a short bio. The Motley Fool owns shares of Google and Apple.Motley Fool newsletter serviceshave recommended buying shares of Apple, Google, and AT&T and creating a bull call spread position in Apple. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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