Is Apple Spiking Network Carriers’ Bottom Lines?

As Apple announced a new procedure for iPhone repairs last week, carriers are looking into a similar policy of taking ownership of damaged phones when they’re shipped from foreign countries. Now that Apple has…

Is Apple Spiking Network Carriers’ Bottom Lines?

As Apple announced a new procedure for iPhone repairs last week, carriers are looking into a similar policy of taking ownership of damaged phones when they’re shipped from foreign countries.

Now that Apple has said that its new iPhone chargers, cable and headphone port can not be used, consumers who still have their handsets can expect a charge: If they can’t reach a store, they’ll be returned to Apple for an exchange. According to Apple, if customers request this, Apple will give them a loaner phone for a year and the credit for the full cost of a new phone. But if they simply want to return their device, they’ll also be covered.

Although Apple already has an iPhone repair program in place, it’s possible that carriers in emerging countries could implement their own procedures, too.

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“We’re closely monitoring the conditions in those [emerging] markets,” says Steve Milunovich, analyst at UBS.

What’s more, the lack of an international policy for carriers to treat customers at their whim doesn’t bode well for Apple. “This is a loss of profitability for Apple,” Milunovich says. “Nothing is free.”

It also means an added expense for carriers. “By continuing to hold onto the phones, they have to handle repair costs,” Milunovich says. “I don’t know how they’re going to cover that.”

What’s more, the new procedure could open up the door for customers to file warranty claims for Apple devices in countries where Apple hasn’t established a repair program. In theory, that could allow users to make warranty claims for Apple devices up to two years after a phone was sold.

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Milunovich says this “could have consequences both good and bad for Apple.” The bad part would be for carrier in emerging markets that “don’t want to be forced into it by Apple.” However, the good part is for consumers who “want to know what’s going on with their iPhone and if it’s eligible for some type of warranty, like Apple.”

While Apple continues to issue fixes for faulty devices in the U.S., those fixes are expected to continue coming from inside the states.

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