According to analyst firm Nomura, AT&T losing their exclusivity agreement for the iPhone next year (when Verizon will start carrying the device) may lead to increased revenues. Let me be very clear that even this expert analytics team says this would be a short effect. Essentially, the idea is that AT&T will bring in a butt load of cash in early termination fees as people jump ship from the lowest rated carrier in the country. They may also save a few bucks on subsidy fees that they currently pay to Apple, as they would be selling fewer iPhones. This logic is kind of like the euphoria that drowning victims experience right before suffocating to death. In other words, it’s not sustainable revenue.
Strictly from an accounting standpoint, this could end up having an immediate positive effect on revenues. But as each quarter passes that AT&T isn’t collecting a monthly subscription fee from their customers that have abandoned ship, they’ll be losing revenue. Also, with added competition comes price wars, which would further cut into AT&T’s revenues.
Clearly the loss of exclusivity isn’t going to bankrupt AT&T. They are the second largest carrier in the US with over 90 million subscribers. iPhone subscribers account for just around 6 million, or about 7% of their total customer base. So even if every iPhone subscriber left for Verizon next year, it wouldn’t be a death blow. But in terms of smartphone sales, losing exclusivity on the iPhone will be a significant loss in a war that has risen to a new level with shifting technology.