Apple Goes to Bat for AT&T During Q1 Earnings Report

Piper Jaffray analyst Gene Munster called Apple to task over the company's exclusive iPhone carrier deal with AT&T during the its first quarter earnings conference call on Monday, and Apple seemed ready to jump to AT&T's defense.

"Obviously AT&T has had a lot of bad press here recently and obviously that impacts your brand," Mr. Munster said. "Can you remind us what the benefits and virtues of sticking with the single carrier in the U.S. are?"

Apple COO Tim Cook replied "AT&T is a great partner."

He added " I think it is important to remember they had more mobile broadband usage than any other carrier in the world. And in the vast majority of locations we think that iPhone customers are having a great experience from the research that we have done."

AT&T has been called to task by iPhone users and the media for sub-par performance in some cities, such as New York and San Francisco. Users have complained about dropped calls and problems using the wireless data network.

"As you know, AT&T has acknowledged that they are having some issues in a few cities and they have very detailed plans to address these," Mr. Cook said. "We have reviewed these plans and we have very high confidence they will make significant progress towards fixing them."

AT&T has improved coverage and 3G wireless data performance in some areas through network upgrades. Denver, for example received a 3G upgrade in October 2009, and AT&T completed its network upgrade in Atlanta earlier in January 2010.

Mr. Cook didn't, however, say how long Apple plans to continue its exclusive partnership with AT&T.

Apple reported its first fiscal quarter earnings for 2010 on January 25. The company posted US$15.68 billion in revenue and $3.38 billion in profit for the quarter, marking yet another record breaking quarter for the company.

iPhone sales were up 100 percent compared to the same quarter last year at 8.7 million units.

The company is planning on introducing what it is calling a "major new product" on Wednesday at a special media event in San Francisco. Even though Apple isn't saying what it will introduce, the general consensus is that a tablet-type device that uses some form of the iPhone OS is on the way.

Whether or not the rumored tablet will include wireless data access over cell networks, and whether or not AT&T will be involved is still a secret.