Pre-orders Of The iPhone On A High; AT&T And Sprint Confirm

Apple is in for some good news. With the pre-orders of the iPhone 5 setting a record of sorts, major carriers such as AT&T and Sprint confirm the willingness of consumers to shell out for the recently launched iteration of the earlier version of the smartphone.

Randall Stephenson, CEO of AT&T, confirmed at the Goldman Sachs conference held in New York that apart from the sales of the iPhone 5 doing excellently well, AT&T was making considerable amount of progress with their 4G LTE network too. In addition to doing well on the iPhone 5 front, they also seem to be hitting it off well in the smartphone market otherwise. However, no further details on the exact number of pre-orders for the iPhone 5 were given out by AT&T. Apple did state that over 2 million orders for the iPhones were placed within 24 hours once the window for pre-orders was opened. Apple plans to officially start shipping the iPhone 5 Friday onwards.

Customers are willing to purchase an iPhone 5 even before their upgrade cycles near an end, as pointed out by Stephenson, proving that this product by Apple seems to have an incredible demand, the magnitude of which is not yet being clearly stated. Dan Hesse, CEO of Sprint, in agreement with Stephenson, stated that the iPhone 5 seems to be a strong selling device that is working wonders for his company. Verizon is offering the iPhone 5 to its customers as well. Three versions of the phone will be available on sale at rates ranging from $399, $299 and $199, with a service contract of two years.

Apple is being paid a subsidy of anything between $425 to $400 for every iPhone that is sold by carriers such as AT&T. Hence, even though the sales may be high, it will still have an impact on the profit margins earned by the carriers. Irrespective of this, Stephenson does believe his company will manage to reach profit margins of 40% in this year, by reportedly selling 25 million smartphones in 2012. Such kinds of margins have to be risked in order to gain fruitful returns on investments which have been made, he pointed out. AT&T’s shares stood at $37.76 last Wednesday even as Sprint’s shares rose by 7%, with each share costing $5.56.