Why doesn’t Ting have the iPhone?

Often, when we talk with potential Ting customers about handsets, the iPhone will come
up. With good reason; even for an Android devotee, the iPhone 4s is an undeniably sweet smartphone.

Around Ting HQ, we’re largely Android users. Many of us made the switch to Android from the iPhone when Ting first came online and never looked back; Android has really come into its own as an excellent OS unto itself. That said, as a mobile company, we would love to be able to offer the iPhone to customers that want it.

To be frank, device supply has been one of the the biggest challenges we’ve faced. While our customers love the idea of paying for minutes, messages and megabytes separately without overages or silly add-on fees, they also want the latest smartphones. We’re geeks first so we understand the all-consuming desire for the latest and greatest gadgets all too well.

The current mobile status quo sees the big name telcos securing device exclusives for their customers by making minimum sales commitments, offering joint marketing efforts including big budget TV commercials and deep device subsidies to lessen sticker shock and bolster sales. In short, device exclusives come down to volume. Carrier subsidized devices also mean term contracts on expensive “unlimited” plans and early termination fees (ETFs) for early exit.

OK… so why don’t you have the iPhone?

Apple has many requirements that a carrier must meet before they can offer the iPhone. The arrangement is very similar to the way device exclusives work but without any actual exclusives being offered.

Apple’s iconic smartphone enjoys a healthy premium over other smartphones whose specs match or even beat out the iPhone. Apple is obviously very careful to protect this premium… and really, who wouldn’t be?

Minimum purchase commitments are but one (albeit very significant) part of the requirements a carrier must promise to meet before it can offer the iPhone to its customers.

Case in point: Sprint’s February 2012 purchase commitment for $15.5b worth of iPhones over the next four years.

Another of the requirements is that a carrier must offer its own support, both for the network (obviously) but also for the iPhone itself. That speaks to one of our core competencies; among our other device-specific support, we offer extensive video start-up guides for all our phones. We offer unparalleled customer support with no-hold, no-transfer customer service at 1-855-TING-FTW. We have extensive help and support documentation on our customer support site.

Apple protects its price by having carriers offer iPhone device subsidies to minimize sticker shock. With subsidies come contracts, early termination fees, upgrade fees and other gotchas.

We’ve heard from customers that they’d be willing to sign a contract if we could offer the iPhone. While we appreciate the sentiment and the trust it demonstrates, mobile contracts go against our core beliefs as a company. They’re complex, which runs contrary to our “mobile that makes sense” mantra. While they allow customers to get the latest and greatest phone with a smaller up-front investment, they’re back-loaded and don’t have customers’ best interests at heart. In short, we don’t now nor will we ever deal in contracts.

We’re working to find other ways we can offer the iPhone to Ting customers. It’s a complicated issue. While we’re knocking on many doors (front, back and side), we don’t expect to have anything of substance to report in the immediate future.

Looking at the list of carriers currently offering the iPhone though, we like our odds.

If the time comes that we can indeed offer the iPhone, the Ting sticker price would be the full, unlocked iPhone price.

We’ll keep you posted as and if we have news on this front. For now though, know that we’re always working on it.

EDIT: We’re offering regular device updates here on the Ting blog. Previously, we didn’t want to talk about our device lineup efforts before they bore fruit for fear of disappointing you. We’ve since realized that wasn’t very Ting of us. Please take these device update posts for what they are: an update on our efforts to get the latest and greatest devices. Not a set in stone device roadmap. With that said, please do take a look if you’d like to know what we’re working on on the device front.