Bernstein Research analyst Tony Sacconaghi estimates that more than a quarter of the iPhones sold in the U.S. have been “unlocked” to work on network providers other than officially sanctioned AT&T.
That’s about 27 percent of the iPhones sold in 2007.
It works out to about 1.45 million handsets.
What do these numbers mean?
Even if they are estimated, these numbers mean that an amazing number of people have taken the time, effort, and trouble to unlock the phones, no matter the complexity or risk. Some of these people are techies and hackers who are comfortable messing around with the innards of electronic equipment.
But to hit these numbers, it means that a whole lotta average folks are unlocking their iPhones or — more likely — paying a cottage industry to do it for them.
“Some unknown number of iPhones are being unlocked by purchasers and some, probably a larger number, are being unlocked for resale,” Ezra Gottheil, an analyst at Technology Business Research, Inc., told the Wall Street Journal. “Some are in inventory. Some will be returned. And some are being used for the non-phone features, as iPhone touches, until the owners can change their wireless contracts. We don’t know the proportions.”
Piper Jaffray analyst Gene Munster told The New York Times, “The majority of the people who were buying (at a recent check at an Apple retail store) more than one phone were Asian, and they were bringing small buses of people who all buy more than one phone. With the value of the dollar, the cost of the phone is much less here.”
Finally, these numbers are further evidence that people in the U.S. want honest to goodness open networks like the kind enjoyed by mobile users in Europe, Asia, and elsewhere in the world.
The Federal Communications Commission has taken notice, mandating that the winner of a part of the 700 MHz spectrum auction that’s currently underway will open the network once it’s built.
But people will not want to wait until 2010 or 2015 for these networks to be built, tested, deployed, and operational. It’s clear they want open networks now, or more likely they want to use a cool, user-friendly device like the iPhone, forget about the network.
And think about the pressure this puts Apple and AT&T under. Spokespeople for both companies declined comment, but their silence still says a mouthful. The unlock situation is only going to get worse.
What are they going to do about it?
Apple supposedly signed an exclusive distribution agreement with AT&T for 5 to 7 years, depending on who you believe. To offer the iPhone on another network in the U.S., the phone must be sold unlocked to GSM providers (like AT&T and T-Mobile) who use SIM card technology. But Verizon’s network, the No. 2 in the country, uses the CDMA platform.
What are the chances that Apple will unveil a CDMA version of the iPhone later this year? And for AT&T to work out some sort of agreement with Apple to allow the iPhone to be sold by other carriers?
It’s wishful thinking, no doubt. But apparently a heck of a lot of people are already doing something about it.