Please ensure Javascript is enabled for purposes of website accessibility

AT&T's iPhone Cannibal?

By Dave Mock – Updated Apr 5, 2017 at 5:27PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Will the Tilt take down the mighty iPhone?

For those who thought AT&T (NYSE:T) was all about the iPhone, check out its latest product for the holidays: the Tilt.

Manufactured by Taiwan's HTC, the Tilt packs more features than the Apple (NASDAQ:AAPL) iPhone, including true broadband data access, a full keyboard, and GPS location capability. You may have heard of HTC before: The company has launched similar feature-packed phones around the world aimed squarely at the iPhone audience.

The Tilt is the latest Microsoft (NASDAQ:MSFT) Windows Mobile-based smartphone that appeals to business users and consumers alike. In addition to sporting camera and media services, the device has the capability of supporting Research In Motion's (NASDAQ:RIMM) Blackberry Connect software, essentially turning it into one of those addictive mobile email terminals.

So why would AT&T launch a device that attempts to upstage arguably the hottest consumer electronic product in decades? Just as I argued that Verizon Wireless' -- a joint venture between Verizon Communications (NYSE:VZ) and Vodafone (NYSE:VOD) -- latest "iPhone-killer," the Voyager, won't bury the iPhone, neither will the HTC device. But some customers will be lured away from the iPhone to the Tilt, either thanks to the lower price or nicer feature set.

As far as AT&T is concerned, though, that's just fine. In fact, the company would probably prefer that subscribers choose the Tilt; it comes with many more features that AT&T can charge extra for and not have to share a percentage with Steve Jobs. 

Even with all the splashy news about killer devices, I feel the iPhone is still in a league of its own. The powerful brand and buzz behind the product leaves competitors really only nibbling away tiny portions of its dominant mindshare. In the same way many consumers thoughtlessly drop $1.25 for a Coca-Cola rather than pay a quarter for a generic soda, I believe consumers have been won over to the iconic Apple brand.

And just as it has done with iPods, Apple will certainly follow with more phones, priced appropriately, to push more consumers to its brand of products. This will help grow its ecosystem not eat it away, just as the Tilt will drive the adoption and use of more AT&T services.

More Foolishness:

Philip Durell has recommended Microsoft, Coca-Cola, and Vodafone to Motley Fool Inside Value subscribers. To see his perspective on these and dozens of other companies priced on the cheap, take a free trial today.

Fool contributor Dave Mock competes with himself all the time, and always comes out a winner. He owns shares of Coca Cola and is the author of The Qualcomm Equation. The Fool's disclosure policy carries a priceless brand value.

Stocks Mentioned

Apple Stock Quote
$140.94 (-1.38%) $-1.97
AT&T Stock Quote
$19.30 (0.68%) $0.13
Microsoft Stock Quote
$244.37 (-0.31%) $0.75
Verizon Communications Stock Quote
Verizon Communications
$37.17 (0.76%) $0.28
Vodafone Group Public Stock Quote
Vodafone Group Public
$10.68 (-1.66%) $0.18
BlackBerry Stock Quote
$4.37 (-4.58%) $0.21

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.