waffle

This “the iPhone could have been possible and successful without marrying a carrier” thing is the gift that just keeps on giving. (By the way, Gruber posits me as trying to argue that selling the iPhone unlocked would be better to Apple; I’m not. I’m arguing that selling the iPhone unlocked would be better to customers and still good, or at least possible, to Apple.)

It’s hard to argue against the current state of things. It’s also hard to argue about, actually, things we don’t know shit about. I can make a qualified guess based on the company’s recorded behavior. Apple’s strategy is to have every product be profitable – the closest thing they have had to loss leaders recently are probably the iTunes Store which makes a relatively mild profit, and the PPC-era Mac mini which went for below $500, and probably turned a profit just because they didn’t have to ship a keyboard or mouse. (And obviously the Cube, which had a margin like you wouldn’t believe but which wasn’t profitable and was cancelled.)

We can see that since the 8GB iPod touch sells for $299 and likely is profitable (otherwise, what’s the point of attempting to sell lots of them?), and that since the 8GB (the only) iPhone sells for $399 and at the very least is profitable with AT&T kickbacks, then it’s likely that an iPhone just below $500 (like I speculated) would be doable.

But instead of playing this game, let’s play a different game.

We all know that in the US, phones have a habit of being sold in bundles prepared by the carrier. We also know that Apple has professed an interest to an unqualified degree of offering new network services like Visual Voicemail, and that they’d prefer it if the carrier gave them carte blanche.

What if Apple had went to all carriers and gotten laughed out of the meeting room at every single one for posing these demands? Do you think Apple would just give up on trying to push a phone for a market with a prevailing standard designed to let you accomodate any carrier you’d like with the same phone? (For those keeping track at home, this is GSM.)

I have an inkling that even without carrier service, Apple could have launched the iPhone, made clear that it could run on AT&T and T-Mobile’s GSM networks and sold millions. I’m not saying any company could have done it, but I think Apple certainly could.

And with this in mind, the user base goes up. Scale goes up. Components get cheaper. Steve Jobs has made a number of how the iPhone has “a lot of custom silicon” – that’d be cheaper especially. International launches shrink to a two-step process: certify the phone with the local authorities and make sure localization (translation, keyboard layouts and special services) are up to snuff. And with a supported SDK and no ball-and-chain carrier to worry about enraging, the field opens up for putting stuff like Skype on the thing.

Are you starting to see where my argument comes from?