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Did Apple offer the iPhone 4 to Smart for 6B?




Heard about it once before and the rumor surfaced again this week that Smart Communications was trying to bid to carry the iPhone 4 in the Philippines. It never materialized so we’ll have to put this entry in the speculative bin.

The iPhone 4 is the 3rd smartphone from Apple to be released exclusively thru Globe Telecom in the Philippines. Globe is partly owned by SingTel (which also got the exclusive deal in Singapore) so it probably was a package deal for them 2 years ago.

However, in some countries or regions, there are multiple carriers that distribute the iPhone. The unconfirmed story is that Apple offered Smart to be the 2nd distributor (or Smart asked Apple what it would take to be a distributor) of the iPhone 4 in the Philippines and the contract/offer was for about Php6 Billion (~$136 million).

Estimates put the total number of handsets in the 200,000 range for that distribution deal. That’s a lot of iPhone 4 they need to sell to get back on the 6B investment and considering a huge number of postpaid subscribers are already locked to Globe, it’s gonna be hard to hit that sales number with existing competition.

Some handset manufacturers tell me that if you can sell over 10,000 smartphones in the country, it’s already considered a hit model. The 100k to 200k figure seems too high a risk. That’s most probably the reason why there’s a 24-month lock-in period when getting a postpaid account for the iPhone — the carrier needs to get that investment back via long-term subscription plans on top of handset sales.

Then again, the media mileage one gets being an exclusive iPhone distributor as well as the coolness factor being an Apple-partner is also part of the package.



Abe is the founder and Editor-in-Chief of YugaTech. You Can follow him on Twitter @abeolandres.

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30 Responses

  1. nexusboy says:

    for some reason, GLOBE was very silent on iPhone sales performance for the past few years.

  2. yuga says:

    @nexusboy – I heard it’s part of the contract with Apple not to divulge sales figures. We asked them several times and all they can say (I guess, allowed to say) is “a lot!”.

  3. Jon says:

    No wonder the iPhone 4 costs an arm and leg, to help these carriers recover their investment.

    IMO, that won’t help at all since people would rather get their phones via the grey market. In some cases, (like the iPhone 4) it may cost more, but at least you don’t get that lock-in for 24 months. Plus, such phones are unlocked, so they could use it with other networks.

  4. Andre says:

    Smart is smart :)

  5. raymond says:

    No wonder Smart is the number 1 cellular company in the Philippines. They make sound business decisions and not just for the sake of being cool.

  6. Elbert says:

    It’s not wise to carry the iPhone locally. It’s readily available in Hong Kong and Singapore and not tied to any carrier.

  7. rene says:

    ahh for vanities sake kim pai!

  8. Fleeb says:

    @Raymond, that’s not how it works :P In fact, it will be a good business decision to sell “cool” and “hip” devices because pride is a human nature. There is money to be made capitalizing on that very nature. :D

  9. Jhay says:

    If the iPhone 4 could offered by Smart at a much lower price than Globe, (wishful thinking) then it wouldn’t be too hard for them to make the 100k-200k mark.

  10. dongv says:

    I think the sale of iPhone (any models) officially in Philippines isn’t very well,
    most people I know, including me & my relatives rather get it at our neighbor countries, so they don’t need to wait & they are assure they have months ahead of those waiting for our Telecom to release it and beg for a unit, & sure they will be getting a better deal outside of Phil and it wont be locked to the greedy big ‘G’, so what is the reason to get it locally, unless your plan is paid by your company and you wont need to shell out money, that will be the only logical reason to get it locally,

    even claiming warranty is easier in other countries than in the Philippines which everytime you are prepare for rounds of fight when you need the warranty, plane ticket are cheaper than the hassle,

    just my 2 cents

  11. mike says:

    I agree, getting it at neighboring countries is a much better option especially in Hong Kong. The 10,000PHP (iPhone 4) price difference between the local and Hong Kong is just right for the plain ticket. You get to buy the iPhone and have a tour while your at it.

  12. Jim says:

    got my iPhone4 from HK too. with all the unlimited calls/texts promos, it’s much cheaper than being locked to a network. though prepaid is a better option nowadays if you wanna save on monthly bills

  13. lolipown says:

    @mike
    not to mention that you can enjoy your time there instead of puckering up at the dreaded lines (of complaints, customer service requests, etc) at the globe centers.

  14. IC DeaDPiPoL says:

    wonder how much damage it would cost Apple if the Philippine market is flooded with Iphone skinned Chinaphones

    XD

  15. Mike says:

    I think one of the reasons why Apple chose Globe over Smart to exclusively sell iphones in the Phils is the fact that Globe has more high-end postpaid subscribers than Smart. Just like in US, iphone are heavily subsidized by carriers to sell the phone at lower price but subscribers are tied up with them for couple of years.

  16. Joshua M says:

    F Globe! Smart and Sun FTW

  17. islacom says:

    thats alotof moola

  18. Andre says:

    The iPhone is no longer exclusive to Singtel in Singapore. I think it was just exclusive to them for the first six months; after that, all the other telcos got them. The iPhone 4 was released simultaneously by all three telcos here in SG.

    So I don’t know why Smart or Sun is still not offering the iPhone in the Phils.

  19. antsmail says:

    yup, iphone is now sold across all 3 telcos in sg, includ iphone 4

    so for us singaporeans, there is a better choice of provider when u wan to buy iphone

  20. Louis says:

    Iphone may be cool but there are some other units that are as good as it… plus Android is also good but if the rumor is true then probably Smart sees an opportunity that it even considered such at a hefty price…if it was true

  21. JunAlquis says:

    I think apple did not pick Smart because while being the largest telco by subscribers in the Philippines, Smart surprisingly has the lowest number of postpaid subscribers in the Country Globe being second and Sun having the highest also Globe has more high end postpaid subscribers.

  22. nexusboy says:

    now that SUN Cellular offers Blackberry, it is more likely the next carrier after Globe to sell iPhone. not likely iPhone 4 but who knows, baka in the coming iPhone generations. but by that time, Android Phones would have overtaken the apple device.

  23. George says:

    Wrong decision by Smart! P6B is not so material to Smart considering that the net income of Smart in 2009 was in roughly P31 Billion…It’s a wrong decision for Smart if that was the case. P6B for just distributing a cool phone can go a long way..it can attract more subscribers, increase publicity, and can increase company morale.

  24. Darel says:

    I think Singtel has more leverage in this thing than Smart. To offset the costs of being THE carrier, Singtel created an umbrella effect where the cost of the phone can be carried by them with their children companies. Smart has no foreign blood to offset the cost, and as such, cannot carry the iPhone without getting crushed by the pricetag. It’s not that they refused, it’s because Smart doesn’t have the money or the connections for it.

  25. Jacob says:

    Globe can carry the iPhone 1,000 for all I care. They should spend their money on improving service, coverage, etc. Geez, over the past two years that I have been on Globe’s Blacberry, there is hardly a week when I don’t experience problems! Back to basics for Globe – they suck, they used to be ahead, they brought GSM to the country, now they are playing catch up big time. Their service is so bad that I would rather go Sun than Globe.

  26. mr.bogus says:

    aanhin naman ang exclusive kung may jailbreak naman!!!! o yeah!!!

  27. annlou says:

    mukha mo jailbreak..haha ungas ka @ mr.bogus

  28. Ettenoj says:

    Kunin na lang ng smart yung new line up ng htc which is windows phone 7 os. Then advertise nila ng maganda para matalo iphone 4.

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