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Quick Bit: iPhone laundering

My father is back in upstate NY, near the Canadian border. He is at the mall where there is an Apple store. He is standing outside the store when he is approached by two Canadians….

They ask him if he wants to go in and buy five iPhones with his credit card and they’ll give him the money in cash. He was skeptical and really didn’t want to participate so he declined. They offered to give him $100 US (which is like what, $95 CAD?), but he still declined. Considering they go for $550-600 US on eBay Canada, he should have asked for more.

I find it interesting, and I didn’t realize that this was such big business, considering the hassles if someone were to accidentally upgrade their phone via iTunes. I’m beginning to wonder if Apple will ever do a compulsory upgrade on the iPhones out there – forcing people to upgrade to the newest firmware if they want to continue to sync and backup their phone.  If the reports of up to 250,000 phones unlocked as of October are true then the unlockers may force Apple’s hand on the issue. It wouldn’t surprise me that the 1.1.3 firmware (which they really should call 1.2.0 considering all the supposed features that will be supported in this release) would be compulsory considering it is likely to be required for the API.

Its not a bad situation for Apple however,  they still make a profit on every phone sold. However it makes it harder for Apple to want to develop firmware upgrades and added functionality when up to 20% of the phones they sell wont be able to upgrade to that firmware revision because the unlock is firmware version specific. Consequently they aren’t receiving the rumored $10/mo per subscriber to pay for the developers doing the firmware upgrades either, so its a double whammy.

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Posted in Apple.

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Continuing the Discussion

  1. Sequence Omega » MacWorld San Francisco: Predictions linked to this post on January 12, 2008

    [...] costs a bit, along with making it harder to tamper with for unlocking (see my previous post on iPhone laundering). Prices stay at $399 for the 8GB and $499 for the 16GB. This is the “minor” upgrade in [...]

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