How Steve Jobs was able to negotiate a revenue-sharing agreement with AT&T
Forbes has an extremely interesting article detailing how the negotiating prowess of Steve Jobs helped Apple secure, for a short time, a revenue-sharing agreement with AT&T along with a host of other perks that carriers had previously been staunchly opposed to.
The following Steve Jobs anecdotes come courtesy of Raj Aggarwal, a telecommunications consultant who, in the months preceding the iPhone announcement, met with Steve Jobs twice a week.
Aggarwal relays that Jobs was able to secure terms that other handset manufacturers couldn't because he was obsessively involved with every detail surrounding the iPhone launch. In conjunction with that, Jobs, in classic fashion, made grandiose demands and never wavered from his commitment to deliver his vision of an ideal user experience.
Aggarwal was impressed by the way Jobs was willing to take a risk to realize his vision. "In one meeting in the conference room with Jobs, he was annoyed that AT&T was spending too much time worrying about the risks of the deal. So he said, 'You know what we should do to stop them from complaining? We should write AT&T a check for $1 billion and if the deal doesn't work out, they can keep the money. Let's give them the $1 billion [Apple had $5 billion in cash at the time] and shut them the hell up,'" Aggarwal recounted.
Although Jobs did not actually offer AT&T the cash, his willingness to do so made an impression on Aggarwal.
Aggarwal also found Jobs unique in his outrageous demands. As he explained, "Jobs said, '$50 a month unlimited voice, data, and SMS plan - that's our mission. We should ask for and go after something unreasonable that no one has been willing to accept.' He would come up with these outrageous demands and fight for them - getting much more than he otherwise would have."
All in all, this is vintage Jobs. You might recall a post from a few days ago where we detailed some of the colorful examples highlighting Steve Jobs' famous, and again, obsessive attention to detail.
There's no question that Jobs was not one to be deterred, and as a result, he certainly rubbed a lot of people the wrong way. The end result, however, was always beneficial for the consumer. Say what you will about the iPhone and Android, but there's no denying that the lengths Apple went to deliver the type of iPhone experience it did fundamentally changed the smartphone landscape while wrestling back a bit of control from the carriers in the process.
Thanks to Jobs and his seemingly outrageous demands, iPhone users have thankfully never had to contend with pre-installed crapware and AT&T logos emblazoned everywhere -- or Intel logos for that matter.
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