"They want to be one of the first ones to get the next cool thing," Mr. Stephenson said. When Apple CEO Steve Jobs introduced the phone in January, he said he anticipated selling as many as 10 million iPhones. About 230 million cellphones currently are in use in the U.S.
AT&T has a multiyear exclusive to offer the iPhone through its AT&T mobile unit, formerly Cingular Wireless. The phones, expected to be available for sale as soon as June, will carry the hefty price tag of $500 to $600 at a time when most phones cost well under $100 -- or are often free with contracts.
Will challenge the industry
There was good buzz among many of the 40,000 conference attendees for the new Apple phone, even though it is bound to rock established players. Apple "will challenge the industry" to improve user interface, said Howard Handler, chief marketing officer for Virgin Mobile. Apple's decision to "take a shot at it could be a game-changer and compel others in the industry to think outside the box," he said.
Not everyone was as enthusiastic. Keynote speaker John Harrobin, VP-marketing and digital media, Verizon Wireless, who addressed the Mobile Entertainment Live, a pre-CTIA session March 26, showed off a service that recognizes a tune and then offers consumers a chance to buy the song over the air as well as ringtones. Verizon Wireless last year began marketing the LG Chocolate phone, a sleek phone with elements reminiscent of the iPod.
"This not a market where one digital music retailer becomes the spigot that turns on and off the faucet of music provided to wireless networks," Mr. Harrobin said. "I advise you all to think differently about this platform," he said, in a twist on the Apple tagline. "It's ours to shape and ours to hold."