Retailing: From A to Z

Until now, Apple has received the main benefits from its iPhones. Because of the popularity of the iPhone, wireless carriers have sold new iPhones for far less than they paid for the phones. They have tried to make up for this by generating new 2-year contracts and selling pricey data plans. However, many long-time wireless customers have been “grandfathered” in for the unlimited data plans that they signed up for in the past — with a lifetime promise for the plan.

With the introduction of the iPhone 5 (and the new technology for android-driven smart phones), things will be changing for the better for wireless carriers — many of whom operate their own retail stores. Why?

As Anoton Troianovski and Spencer Ante report for the Wall Street Journal: “The carriers have fought back this year, introducing new upgrade fees to reduce the cost of subsidizing all those new iPhones. But the biggest impact could come from new data plans debuting this summer, which should squeeze more money from subscribers hooked on the new phone’s faster data speeds. Carriers have made a number of adjustments since Apple last introduced a new iPhone, including imposing new upgrade fees and setting up new data Among carriers the hope is that the new iPhone — running for the first time on the fastest fourth-generation networks — will change consumer behavior. Downloading videos and surfing the Web should be a more seamless, and more profitable, undertaking.” And the old lifetime guarantees would not apply to the faster network.

Here are links to two WSJ videos on this:

http://on.wsj.com/QzaNPq

http://on.wsj.com/RHu1wA