Look at Verizon's profit vs Apple's. http://www.bloomberg.com/news/2012-01-24/verizon-posts-loss-on-pension-costs-as-rising-iphone-sales-boost-expenses.html ht

Look at Verizon's profit vs Apple's. http://www.bloomberg.com/news/2012-01-24/verizon-posts-loss-on-pension-costs-as-rising-iphone-sales-boost-expenses.html http://www.bloomberg.com/news/2012-01-24/verizon-posts-loss-... > Verizon and rivals such as AT&T Inc. sell the Apple Inc. (AAPL) iPhone and other smartphones at a loss as they compete to get customers to sign up for contracts that typically run for two years. Verizon et al, run a 24x7 data/voice nationwide network. That involves constant physical construction and capital investment. Apple is the clear winner, selling their product at a premium with the middle man subsidizing the consumer's purchase price.