North American phone carriers are far too dependent on subsidies, argues the Yankee Group. The research firm uses the particular example of the iPhone, which is said to turn only a small profit for AT&T. The carrier is able to lock customers into two-year contracts, but only after knocking several hundred dollars off the price of each phone. After also taking into account the impact of high data usage, the company is only breaking even on iPhones roughly 17 months into each contract. Yankee suggests that if AT&T were to eliminate subsidies, it could break even in
