AT&T Mobility has a 75 percent chance of remaining the exclusive U.S. carrier for Apple's iPhone into 2011, according to Credit Suisse analyst Jonathan Chaplin.
Whether and when AT&T loses its hold on the iPhone has been one of the most hotly debated questions in the industry for much of the past year. Chaplin's new analysis cuts against industry consensus that AT&T's exclusive rights to the popular smartphone end in June.
How does Credit Suisse arrive at the 75 percent probability? "First, we try to determine whether the Apple/AT&T agreement expires in 2010. The consensus view is that it does; however, we couldn't find compelling evidence that this is the case," Chaplin wrote in a note to investors. "We conclude that there is only a 50 percent probability that it ends in 2010. Next, we try to determine whether AT&T bids for another year of exclusivity if exclusivity does end in 2010. We conclude that they would and that they can afford to compensate Apple such that Apple would be economically indifferent. Our approach yields a 25 percent probability for this outcome. Taken together, we see a 75 percent probability that AT&T keeps exclusivity for another year."
Verizon Wireless has repeatedly been mentioned as a possible partner for the iPhone, though neither Verizon nor Apple has made any official announcements on the topic.
AT&T, which activated 3.1 million iPhone users in fourth quarter (more than one third of which were new to AT&T), has been relying on growth in its wireless segment to offset weakness in its landline division. And the carrier said it plans to boost investments in its wireless network, which has been criticized as unable to handle iPhone users' penchant for data. The carrier plans to improve wireless backhaul and upgrade to HSPA 7.2 network technology by spending $18 billion to $19 billion on its network this year, up from the $17.3 billion it spent in 2009.
However, AT&T also appears to be broadening its smartphone options; in January, the carrier said it would be launching phones running Google's Android OS and Palm's webOS platform.
- see this GigaOM post
AT&T nears record with 2.7M net adds in Q4
AT&T strengthens smartphone portfolio, outlines app store and OS support
AT&T activates 3.2M iPhones in Q3, hints at end to exclusivity
AT&T hasn't decided yet on tiered data pricing
AT&T chief addresses network problems in NYC, San Fran