updated 12:10 pm EDT, Thu July 11, 2013
Apple, Verizon may choose to renegotiate
Verizon could lose between $12 billion and $14 billion this year based on its iPhone deal with Apple, claims telecoms analyst Craig Moffett. The carrier signed the deal in 2010, and is reportedly obligated to buy $23.5 billion in iPhones during 2013. That's twice the value of the iPhones Verizon sold in 2012, Moffett says, leading to the predicted shortfall.
Apple regularly makes prospective iPhone carriers agree to minimum unit purchases. While some carriers will refuse, knowing the potential pitfalls, others may feel they have no choice but to agree given the iPhone's popularity. Sprint and T-Mobile, for instance, both saw steady erosion of their subscriber numbers until they signed iPhone deals.
Moffett suggests however that Apple is unlikely to make Verizon pay the full amount on any shortfall. Instead he argues that Apple will likely demand concessions if the two parties agree to renegotiate.