So, historically the maring on the iphone was 320$ or so, so with the 200$ price drop, that is now 120$ or so. The meat, was the revenue share on:

ACTIVATION
DATA PLAN
VOICE PLAN

all of which were unprecidented for a hardware company

Now that the margin is just about 25%, I don't think this is such a good deal, but I ALSO don't think that many will do the non-activation dance. Apple has a bit of a problem in that they don't capture activation information at the time of iphone order from apple or apple.com, but they require it when signing up for itunes and activating the phone.

I don't really see an huge unlock option for buying a phone, but NEVER activating it with ATT. Has anyone been able to BUY A phone, run the SIMUNLOCK, activate on itunes with a third party sim and NEVER sign up with ATT?

So, for apple if the WORLD went this way, it would be a major revenue hit.

Not to mention the fact that their Revenue Recognition practice on the iphone is to spread all revenue over 24 months, the anticipated life of the ATT service contract.

So, WOW 120$, now spread over 24 months is going to be NO NICE pop to MRR or per share earnings.