T-Mobile says it cannot afford the iPhone

T-Mobile is the furthest behind of the four major U.S. telcos in 4G LTE deployment and it’s been losing customers to AT&T, Verizon and Sprint over its ongoing inability to offer the iPhone. Though the Deutsche Telekom-owned carrier offers free support and Nano SIMs to unlockers, it stopped using the iPhone name to drive sales.

As things stand now, a much-needed deal with Apple continues to be just a wishful thinking. Optimists amongst analysts are positive 2013 will be the year the iPhone lands on T-Mobile’s network. Others point to the $10 billion dent in carriers’ profits over high iPhone subsidy, which is estimated to an average of $425 per handset. And now, T-Mobile’s op-chief re-iterates that his company won’t be able to afford the iPhone unless Apple budges on its asinine position…

Speaking at Morgan Stanley’s Technology, Media & Telecoms Conference this week, T-Mobile COO Jim Alling said in no ambiguous terms (via FierceWireless):

Make no mistake about it: We would love to carry the iPhone. However, we want the economies to be right for us.

He went on to say T-Mobile wouldn’t want to sell its soul to Apple like Sprint did.

“We recognize that it has been a point of churn for us”, he said of the ongoing customer defection to rival telcos. T-Mobile currently hosts a nice 1.5 million unlocked iPhones on its network. The exec expects that number to go up as the carrier rolls out its iPhone-friendly HSPA+ network on the 1900MHz band in more markets.

And CTO Neville Ray underscored T-Mobile is still on track to launch LTE radio technology in the second half of 2013, with the hope of covering 200 million people with LTE by year-end 2013.

The MetroPCS spectrum gained through the merger means T-Mobile will be able to expand LTE service to 20×20 MHz “in many markets”.

Of course, carriers have been complaining forever about high iPhone subsidy.

It’s not just empty talk.

For example, the Czech and Slovak units of Spain’s Telefonica SA recently locked horns with Apple over the terms of iPhone 5 sale.

Due to its popularity and Apple’s stringent terms of business, telcos are required to allocate billions in prepaid subsidies, later recouping that money over the course of iPhone users’ service contracts.

Needles to say, such massive investments hurt their margins short-term. No wonder major wireless service operators frequently dream about dropping iPhone subsidy altogether.

But for all the talk about putting the iPhone in its place, carriers continue to put up with high costs of doing business with Apple.

Apple’s arrogance was also blamed for low iPhone penetration in Russia, which sells one of the most expensive iPhones in the world, alongside Brazil and India.

What do you think?

Is T-Mobile USA ever going to officially land the iPhone?