Apple Inc. (NASDAQ:AAPL) began expanding their iPhone coverage last October when it began offering the popular smartphone to regional wireless network customers in the United States. The company is now offering the device to a new carrier nTelos Wireless. NTelos Holdings Corp. (NASDAQ:NTLS) offers coverage mainly in Virginia and West Virginia but also in parts of neighboring states such as Maryland, Kentucky, Pennsylvania and Ohio. The first such deal was struck with C Spire wireless last October. That company had about 900,000 subscribers and operated in Mississippi, Memphis and parts of Florida, Alabama and Georgia. The move is part of Tim Cook’s strrategy of pushing the iPhone to the highest sales numbers it can manage while still receiving advantageous deals from carriers.
nTelos boasts an unlimited data plan, something the two biggest US carriers have dropped with just Sprint maintaining the offer. It becomes the fifth US wireless network to acquire the phone after At&T, Sprint, nTelos and Verizon. The country’s fourth largest service provider, T-Mobile, still has not picked up the device. nTelos will hope the addition of the iPhone in conjunction with its unlimited data plan will bring customers off of some of the larger networks in favor of the regional network.
A forecast by a JPMorgan analyst showed yesterday that sales of Apple’s iPhone would be larger than predicted in the first quarter of 2012 and would be better than expected for the year as a whole. The agressive expansion of the number of carriers the iPhone will be available on is a change from the company’s initial position of exclusivity that demanded carriers subsidize the phone drastically. The new strategy will allow Apple to offer its device to more customers than ever before and should entitle them to a larger chunk of sales, assuming the demand for its device remains proportionally the same in the south. A more aggressive and similar strategy is being followed in China where the company has also expanded to another network.
If the idea pays off for the company it will ensure the growing dominance of the smart phone in the market and continue the company’s upward trajectory. The deals with the regional carriers do suggest that Apple is willing to except a less favorable deal now in order to reach more customers. This may be a reaction to the growing mobile App market which is continuing to add to the company’s revenue, and the loss of Wow factor the iPhone has now when compared to its initial release.
