The Untold Story: How the iPhone Blew Up the Wireless Industry

Wired has a very interesting and revealing story on the making of the Apple iPhone, especially regarding how Steve Jobs was able to convince ATT (Cingular at that time) to offer the iPhone on HIS terms - in return for five years of exclusivity, roughly 10% of iPhone sales in ATT stores, and a thin slice of Apple's iTunes revenue.

In addition, he succeeded in getting ATT into spending millions of dollars and thousands of man-hours to create a new feature, so-called visual voicemail, and to reinvent the time-consuming in-store sign-up process. He also got a unique revenue-sharing arrangement, garnering roughly $10 a month from every iPhone customer's ATT bill.

On top of all that, Apple retained complete control over the design, manufacturing, and marketing of the iPhone. Jobs had done the unthinkable: squeezed a good deal out of one of the largest players in the entrenched wireless industry. The deal had given Jobs, and Apple, unprecedented power and effectively rewrote the book on how phone manufacturers deal with telcos.

Complete story is available here.