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Carriers blame the iPhone for data caps and increased upgrade fees

“Bruised” mobile carriers such as AT&T (T) and Verizon (VZ) are “fighting back” against Apple’s (AAPL) iPhone, despite the fact that the device has helped them eke out consistently higher average revenue per wireless subscribers since its launch, The Wall Street Journal reports. To hear the carriers tell it, the iPhone is a major inhibitor to their profits as last year they were “only” generating wireless service profit margins in the 38% to 42% range.

But ever since these beleaguered companies started “fighting back” by implementing data caps, increasing fees for device upgrades and implementing longer waiting periods before users can switch devices, they’ve seen their wireless service profit margins surge. AT&T reported a 45% margin in Q2 2012 and Verizon reported a record-high 49% margin.

Simply put, users shouldn’t expect their carriers to stop cranking up fees or do away with data caps anytime soon because such practices are making the carriers a lot of money.


Prior to joining BGR as News Editor, Brad Reed spent five years covering the wireless industry for Network World. His first smartphone was a BlackBerry but he has since become a loyal Android user.