Tim Cook: Apple “not married” to exclusive deals for iPhone

Apple Chief Operating Officer Tim Cook spoke yesterday at the Goldman Sachs Technology Investment Symposium in Las Vegas and had some interesting things to say about the iPhone. In what’s already becoming one of those soundbites heard ‘round the world, Cook made a comment about Apple’s choice to use exclusive deals with cell phone providers:

In the US, our fundamental choice was “Do we want to develop two phones, a CDMA phone and a GSM phone?” And we didn’t. We wanted to do the simplest approach in the beginning, because that’s the fastest way to learn…and AT&T is the largest carrier and the business relationship we could work with AT&T allowed Apple to be Apple and AT&T to be AT&T…We feel very good about that. We went into Europe and we picked the top carrier in each of those three countries…Now, are we married to this model? Will we do that everywhere? We’re not married to any business model. What we’re married to is shipping the best phone in the world […] You might find [a country] where being exclusive might not be in our best interests…we’re going to intelligently think about each one and decide what’s best for the company to do.

Of course, Cook was clear that he’s not saying that Apple will choose to go the non-exclusive route, but that it may be an option, given the circumstances. Given that no matter how much they make off carrier deals, Apple is above all in the business of selling iPhones, it’s not surprising that they’re leaving the option open.

Cook also briefly discussed third-party applications, though he declined to give specifics, saying that he wanted to leave some surprise for next week’s SDK event. He also touched on iPhone inventory levels—specifically the so-called “missing million” iPhones that form the discrepancy between sold and activated iPhones. And, unsurprisingly, the COO also reiterated Apple’s goal of selling 10 million units in 2008. Here’s a transcript of the relevant portion:

We have a situation where we purposely rolled out iPhone in four markets…we did this at this chosen speed so we would learn and could apply those learnings to future rollouts. We are right on track where we want to be. The 4 million units we’ve sold over the first 200 days gives us confidence we can achieve 10 million units in 2008….We believe we’re right on track for that.

So, where are the iPhones?…The demand for the iPhone is so intense in the market where we aren’t officially selling that people are exporting it out of the US in many different ways and then running it on local carriers in countries where we’re not officially selling it. It shows a lot of worldwide demand. […]

There will always be some level of hacking. There will always be a case where someone wants to run on a different carrier. In the US, what we see, very few people have bought a phone to unlock it and use it on a carrier on AT&T. What’s happening is people in all of these countries around the world are finding ways to get the phone in their country. Of all the problems that I might face, this is one that I face looking at with a little bit of a smile, because it means there’s great demand for the phone. To have people stepping over each other to get the phone isn’t a bad thing, I say.

There’s a full stream of the discussion at Apple, should you be interested in the entire 45-minute session, in which he also talks about Apple’s stance on innovation, the Mac, Apple TV, and more.

[via BusinessWeek]

Category: News

Posted by Dan Moren on Feb 28 2008, 12:01 PM ET

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iPhone illustration by Joe Zeff Design Inc. // Design by Jason Brightman