Monday, March 24, 2008

Could Radio Shack become an iPhone vendor?

I don’t often write about rumors I read elsewhere, much less contribute my own, but I happened upon a tidbit of information recently that could very well come to pass.

My source is not a secret informant from deep inside one of the companies or a parts supplier in a distant nation – the sources of most Apple rumors. This information came up in a casual conversation with a salesman at a Radio Shack store.

I had gone to get the batteries in my cordless phones replaced when I noticed the displays for the various cell phone providers, including one for AT&T. As the salesman was digging for my replacement batteries, I half-jokingly asked him when the store would be getting the iPhone.

To my surprise, he answered seriously. “They told us we were getting them in January,” he replied, “But we haven’t seen any yet.” He suggested he still expects to see iPhones in his Radio Shack at some point.

True, this guy is at the bottom of the communication chain and could have been mistaken. But my sense was that the promise he had heard came from an authoritative source.

Since I’m already living on the edge today, let’s look at whether selling the iPhone at Radio Shacks makes sense.

It’s not such a ridiculous notion. In addition to the existing relationship with AT&T, Radio Shack currently sells Apple’s line of iPods.

As for incentives, Radio Shack would love to offer the iPhone. It’s a sexy product of the sort Radio Shack has in very short supply and would help generate traffic into the struggling chain’s stores. People coming to shop for an iPhone might buy some of that other odd electronic clutter you find there.

The more puzzling question is why Apple (or AT&T, for that matter) would feel the need to add Radio Shack to the iPhone distribution channel.

It could be a simple numbers game. Apple sells the iPhone through its 170-plus U.S. Apple Stores, strategically located in high-end malls but not necessarily convenient for everyone. AT&T sells the iPhone through 1,800 of its retail locations.

But Radio Shack has nearly 6,000 stores in the United States and 800 wireless phone kiosks. Putting Radio Shack on the iPhone team would make it more convenient for more people to buy an iPhone (well, in the U.S. anyway).

Apple’s motive for partnering with Radio Shack is its ambitious sales goals for the iPhone. The company’s objective is to sell 10 million iPhones in 2008; adding 6,800 locations could help a little.

That also would fit in with Apple’s aggressive iPhone marketing strategies. Recall the six months of hype before anyone could even buy the product. Recall the rollout just months later into the United Kingdom, Germany and France. Recall the recent release of the iPhone SDK to permit developers to write software for the iPhone.

And Apple’s move to give the iPhone corporate-compatible features to attract enterprise customers is almost shockingly out of character for a company that has for years willfully ignored business customers.

Radio Shack selling iPhones? Crazier things have happened.


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