Wireless newcomers Charter and Comcast have gained the right to sell Apple’s popular iPhone to their customers, but to do so they had to agree to sell the iPad and the Apple TV.
CNBC reports Charter and Comcast have agreed to Apple’s somewhat onerous terms in return for the ability to sell the iPhone. The usual “people familiar with the matter” says the deals were signed two years ago, just before the launch of the two cable providers’ mobile virtual network operator (MVNO) services.
Comcast’s Xfinity Mobile division is required to sell a certain number of iPads at a subsidized cost. The quota is reportedly “in the thousands” and forces Comcast to make up the difference between the iPad’s normal retail price and the subsidized rate.
While sales of the iPad were strong for the first quarter of 2019, the Comcast deal was made when iPad sales were sagging, prompting Apple to push the large iPad selling requirement on Comcast, one of the sources said.
The report says Charter doesn’t face the same terms for the iPad as Comcast, since Charter allows its customers to use Apple TVs as replacement set-top devices for Charter’s legacy boxes. (Customers have the option to add a 32GB Apple TV to their Spectrum cable subscription for $7.50 per month for 24 months.)
The deal is said to have made Charter the largest third-party seller of Apple TV units.
Apple has a record of using the iPhone’s mass appeal as leverage with wireless carriers. As noted by AppleInsider, Japan’s NTT DoCoMo reportedly promised a 40% quota to get the rights to the iPhone after losing market share to competitors that had access to the handset.