Mobile Carriers are Critical to iPhone’s Competition with Android

Last week, we looked back at how Apple has competed with Android in the US in recent years. We saw Apple’s 2023 share of smartphone sales at 36%, continuing a gradual decline from a high of 45% in 2020. Here, we begin to explain how mobile carriers impact this share.

Note mobile carrier stores and online outlets control about three-quarters of the sales of iPhones, and 55% of the mobile phone market overall. The rest of the phones are sold by Best Buy, Amazon, mass merchants, and of course Apple Stores and the Apple website. Beyond their power as retailers, the mobile carriers drive sales with the promotions they choose to offer. Trade-in deals that motivate specific model purchases are common, and co-op advertising for mobile carriers subsidized by smartphone manufacturers is the norm.

In 2008 Apple released the first iPhone exclusively on the AT&T GSM mobile network. With their CDMA networks, Verizon came next in early 2011, followed by Sprint later that year. Though T-Mobile used a similar GSM network to AT&T, they were the fourth of the major carriers to offer iPhones starting in 2013. Because of this staged rollout, and differences in their customer bases, Apple share of smartphone sales varies dramatically by carrier. In 2023, iPhone had its largest share at AT&T, at 48% of smartphone sales. It had its lowest share at T-Mobile and discount and regional carriers, with 28% of sales (Chart 1).