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Comment by otterley | Hacker News Reader

Apple had every opportunity to sell the iPhone standalone, without any participation from the carriers. Given the iPhone's obvious lure, especially when first released, Apple might have succeeded in upsetting the long-lamented model where devices are locked to and subsidized by carriers. They could have easily directed customers to purchase the iPhone and direct customers to purchase service separately.

Why didn't they?

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The original iPhone wasn't carrier subsidized - you could walk into the store and buy one, without a contract. You'd set up the contract when you got home, through iTunes.

It was locked to Cingular/AT&T, but that was, as the other commenter said, more of a Visual VM thing than anything else.

I'm thinking this started because Apple wanted to change the way phones were sold, but changed because selling a $599 (or $399 after the price drop) phone wasn't tenable in the US market.

To an extent... I always thought Apple went with non-carrier subsidized pricing on the first iPhone because they wanted sales now. The price even dropped $200, IIRC, only two months after launch. This supports your last comment because they fueled sales. My experience is that people wait until their contract obligation is complete before shopping another handset.

The problem with selling a $599 phone in the U.S. market was that unlike in other countries where an unsubsidized phone will get you a cheaper plan (thus making it cheaper in the long run), IIRC the iPhone plans were actually more expensive.

Experience in market and a totally different type of phone are reasons. I am pretty sure some features required carrier support (i.e. Visual Voicemail). The initial data plans were also a bit different than a traditional offering. The iPhone was not a sure bet even with the backing of a carrier.

The carriers probably have many ways of making phone manufacturers miserable if they choose to do so.

Because they collaborated with then-Cingular to do Visual Voicemail. Also the thinking then was that they could earn a kickback from the carrier for exclusivity.

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