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There is a factual error in this article, in the razor/blades analogy. The monthly service fees for an iPhone don't just benefit the carrier; a portion of the
by shimon 18y ago
There is a factual error in this article, in the razor/blades analogy. The monthly service fees for an iPhone don't just benefit the carrier; a portion of the service fees goes to Apple as well. I'm not sure what the portion is (or if that information is public) but this sort of revenue-sharing approach is now relatively common for big-name smartphones.
- wmf 18y agoFor the iPhone 2G it is rumored that Apple gets a monthly kickback from AT&T. For the iPhone 3G it is rumored that Apple gets over $200 upfront from AT&T and nothing after that. But as someone else pointed out, if you make money on the razor and the blades it's not the Gillette business model.