dcsimg
RealTime IT News

So the Apple/AT&T contract IS for five years

Thumbnail image for iphone3g_pair.jpg

One of the lingering questions surrounding the possibility of a Verizon iPhone is how long the Apple/AT&T exclusive contract runs. The current view is that it runs three years, which would have it ending this year, while back when the deal was first announced, USA Today reported the deal was five years.

This end date is important. If it's a three-year deal, like so many in the press have insisted, then the contract ends this year. If it's five years, then we have to wait until 2012.

As it turns out, the answer has been right under everyone's nose, and hats off to Engadget for finding it first. A class action suit filed in 2007 over the deal itself has forced Apple's hand. The suit, filed in 2007, claims that Apple and AT&T formed an illegal monopoly by requiring two-year contracts when the deal was for five years, since this would mean some people would have to sign up for three years instead of two.

The suit (here in PDF format) is actually a laundry list of complaints, such as Apple disabling jailbroken phones. Apple had to respond to this (here in PDF format), and in doing so, revealed the contract length in its response filed in June 2008.

In its filing, Apple cites the USA Today article, and pretty much affirms that the multicolored newspaper got it right:

The duration of the exclusive Apple-ATTM agreement was not "secret" either. The RCAC quotes a May 21, 2007 USA Today article - published over a month before the iPhone's release - stating, "AT&T has exclusive U.S. distribution rights for five years - an eternity in the go-go cellphone world."

The rest of the document makes repeated references to the "five-year exclusivity" of the contract.

The case is ongoing, but most of it has been under seal since 2009. As Engadget notes, it's been a few years, the contract may have been revisited for any number of reasons. The two companies recently sat down to work out the iPad 3G contract. Did Apple try to get out? We don't know. Chances are we'll find out next month at the Worldwide Developer Conference.

Comment and Contribute