Death Star Extends Death Grip On iPhone

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Back in August, we reported that AT&T — whose exclusive contract to sell and support the iPhone was due to end this year — had negotiated to keep their marriage with the House of Jobs intact until 2010.

Now comes word that the Death Star has signed up for ANOTHER year of cohabitation.

Blame — or credit — goes to AT&T CEO Randall Stephenson, who joined the company just as the iPhone was first hitting the retail channels, and rode its momentum as it revitalized the 120-year-old telecom company.

But Stephenson's doing more than just keeping Apple's must-have device in their own sandbox.  He's looking to make wireless business the company's cornerstone, even at the expense of its legacy land line infrastructure.  One plan is to remove the requirement of having an AT&T home phone in order to get discounts on TV or broadband Internet, a la Comcast or Verizon FIOS:

"We have 77 million wireless customers and 30 million consumer phone
lines.  Which
customer base would you rather work from? We tend to come at this

But all this comes amidst news that AT&T is cutting 12,000 jobs and reducing capital spending by 15% this year — on top of $18.8 billion in acquisitions of radio spectrum and smaller cellphone
companies in the past two years, as well as expenditures of $1.3 billion to discount the

No wonder they don't wanna loosen their grip: that little rectangle of metal and glass could be AT&T's life preserver.

[Via the Wall Street Journal]

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