Financial Times: How the ‘Walled Garden’ Promotes Innovation, Thomas Hazlett

An intense iPhone buzz sent a high-pitched signal to Apple fanatics early this summer in the US. They hurled themselves into AT&T sales offices and are still giggly with technophile delight. The means by which Apple a computer products company without wireless assets launched the mobile phone of the century illustrates how markets introduce innovation. AT&T was eager to host the iPhone on its mobile network. The carrier extended terms so generous (Apple reputedly keeps all handset revenues and $10 a month per subscriber) that, while Apple’s market capitalisation surged $20bn on iPhone profits buzz, AT&T’s shares barely budged.  Full article available at  Also available by [PDF Download] on Prof. Hazlett’s faculty profile.

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