Glenn Lurie, AT&T’s point man on the iPhone project. He is interviewed by Seattle Times ,belows are the conversation.

Q: One point of skepticism is the price. That BlackJack is pretty nice, and it costs $500 less than an iPhone …

A: Here’s how I’d explain it. The most popular iPod, a 4-gigabyte Nano, costs $200. If you’ve got a RIM BlackBerry or Palm Treo, you probably paid $200 minimum. Then you’ve got a phone that you got for free or paid maybe $50.

You’re at $450 or $500. The question you’ve got to be able to ask yourself is, is this device going to be able to replace those three, so you carry one? That’s the question.

I think when people get their hands on it and really experience it — the touch screen is phenomenal, this touch screen is like nothing you’ve ever used — to experience that, the skepticism, I think, around some of those things will go away.

There are other things — you have the widgets, some of the Google applications that are coming — there are just so many things here that the price will not be an issue.

Q: So you don’t think you’ll have to subsidize the phone’s price?

A: We’re not talking about that.

Q: What’s your impression of Apple?

A: It’s a great company. I know there are lots of interesting thoughts out there about how Steve and his team have done so many things, but they have been such innovators. If you look at the music side, it’s hard to argue that they aren’t driving a lot of things.

Q: What’s your favorite iPhone feature?

A: I don’t know if I can answer that. It’s a pretty incredible browsing environment. That’s the first part that I think will blow people away. It’s the first widescreen iPod they’ve ever done; it is very, very good, works extremely well.

I think the other thing people haven’t really thought through is that Apple’s so good at simplifying things. That’s just what they’re known for; they’ve really simplified the phone. The standard phone applications are really intuitive, whether it’s receiving a phone call, putting that person on hold, adding another party and bringing a conference call together.

Q: Won’t the full-powered browser hurt AT&T? People won’t need to use its services as much — they’ll just pull things from the Web, instead of calling directory assistance, for example.

A: No, actually it won’t. I think it will be great for us, and here’s why. One of the things with this device — people are going to be asked to have an unlimited package — people are going to have to have a package with us to browse. That’s one good thing for everybody.

I think this is going to create a new way people use handheld devices because the browsing experience is as good as the PC browsing experience. So I think it’s not going to hurt us at all. I’m excited about what it will do for the industry in terms of how people view mobile browsing.

Q: What’s the risk in your deal with Apple? Are there downsides or concerns?

A: Not that I can see. The thing I get asked about a lot is, obviously, that our companies are different cultures. But they have been incredible to work with.

The one thing we found as commonality is our pursuit of customer experience. Whenever we got into discussions, the thing we kept coming back to was this unwavering “what’s the customer experience going to be?” That’s gotten us over the hump every single time.

Q: What do you think of Jobs?

A: He’s a great guy. I’ve been dealing with Steve a lot. I think my prior comments fit: He is all about the customer, the customer experience, making sure that what customers get meets expectations. That’s what my mesh has been.

Posted on May 29th, 2007 by admin
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The Cingular brand name is officially dead, gone, swimming with the fishes. By the end of this week all 1,800 Cingular corporate stores will have been rebranded to AT&T. Cingular has meant a lot of things to a lot of people. Hot phones, horrible service, botched launches,  and much much more. AT&T is re-adopting their corporate name right in time for the upcoming Apple iPhone(formly also called Cingular iPhone) launch, which is sure to cement the AT&T brand into every home, brothel, and trailer park in the United States. It’s a bit much to say that the good old “jack” will be sorely missed, but these store renovations mark the last in a rapid fire string of events that have certainly altered the fabric of American wireless carriers. Oh how melodramatic.

From Boygeniusreport

Posted on May 24th, 2007 by admin
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Cingular Wireless believes the price is right on its new $499-plus Apple Inc.(Nasdaq: AAPL)iPhone, and expects the new device to help increase its business after the launch in June.

Some commentators have questioned the high price of the iPhone. At $499 for a 4-Gbyte device and $599 for an 8-Gbyte model, it easily tops most of the smartphone offerings that will be its main competition.

Cingular, however, believes that the device is “absolutely priced right” for the audience it is targeting. “I am not at all concerned,” says Glenn Lurie, Cingular’s president of national distribution.

“Most of you in this room are probably going to be carrying a cellphone,” explains Lurie. “Most of you will have a smartphone –- a BlackBerry or a Treo -– and most of you have an iPod in your bag or suitcase.”

Cingular’s claim is that the cingular iPhone can replace all three.

Nonetheless, questions remain over how much influence, if any, Cingular has over iPhone pricing and feature developments. “It’s an iPod, so Apple sets price points,” Lurie stated after a few questions about whether the carrier could cut the price of devices over time.

The operator has an exclusive deal to distribute the iPhone in the U.S. and stressed it had worked closely for two years with Apple on the iPhone project.

Apple, however, has control over some issues that would normally be the domain of the wireless operator.

For instance, Cingular couldn’t tell  why Apple had chosen to launch an EDGE-enabled device, rather than one that’ll run over its faster UMTS network, which would seem to make more sense for such a high-powered device. “You’ll have to ask Apple that,” a Cingular rep told us.

The computer vendor is predicting it will sell 10 million iPhones by the end of 2008. Cingular stressed, however, that this figure incorporates sales from the other non-U.S. carriers that will sell the new Apple device.

“I think other carriers are going to be interested,” dead-panned Lurie.

Branding should be easy. Cingular will have its name and -– eventually -– the AT&T Inc.  logo on the phone’s screen. It won’t be embossed anywhere on the device, however. This is highly unusual in the U.S. mobile market, where branding is everything. Apple should have a slightly simpler job launching the device in Europe and Asia using screen-only branding, however.

It’s not yet clear whether Cisco Systems Inc’s newly announced lawsuit against Apple will change any of Cingular’s launch plans.

Posted on May 21st, 2007 by admin
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This is all conjecture, but here’s my guess on why Apple chose to give Cingular the exclusive on the iPhone:

I’m guessing this is $800-900 device.  The way these deals usually get done is the manufacturer has to make a deal with the carrier to sell  a minimum X number of phones at a retail price that is palatable to consumers (in this case, $499 or $599 depending on the storage capacity of 4GB or 8GB), in exchange for the exclusive and being able to lock the subscriber up for 1 or 2 years.  Cingular agrees to eat a few hundred dollars per device that they hope to make back by locking you into that contract, and for a device like this, enticing you to sign up for a $39.99 all you can eat data plan to go with the phone and whatever voice plan you choose.  When they don’t meet their minimum X, they are generally sold off to secondary retailers and authorized resellers such as inphonic (wirefly.com) or Amazon.

If you read your Cingular contract carefully, you will see there is a replacement cost for your phone that will generally exceed the price you are paying by quite a bit.

Let’s face it, this will be a hot cingular iPhone, so I’m sure it wasn’t a hard deal for Cingular to stomach, even with the steep subsidy cost. Having an exclusive allows Cingular to control their profit or loss on the device. It’s good for Apple, because they can get distribution of their device at a retail price that is well below their cost while they work with their manufacturer on finding cheaper components to raise margins for their version 2 device.

Apple’s marketing plans clearly called for a device to be sold outside the U.S. (read the 10:48 comment at engadget that mentions Europe in Q4 07 and Asia in 08) - so that cut out Sprint and Verizon, whose CDMA networks aren’t very compatible with any other place except Korea.  That leaves T-Mobile and Cingular, who have GSM networks.   I’m sure they shopped the deal, but if i were doing this deal, I’d look at the demographics of both networks and probably arrive at the same conclusion.

Posted on May 21st, 2007 by admin
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