Gene Munster of Piper Jaffray points out that the iPhone is now being sold with a new business model: 

Now, the carriers are subsidizing the cost of the phone, making up for it in monthly charges, and they are no longer funneling a share of that monthly revenue to Apple. As Piper Jaffray’s Gene Munster puts it: “Apple is basically playing by the rules that all other cell phone hardware manufacturers play by.”

Which basically means that for every device that AT&T activates, Apple collects a one time revenue, and gets no share of the monthly charges.

This is very different from the earlier business model, where for every device activated,  ATA&T made an initial payment to Apple, and then also paid Apple a part of the monthly revenue throughout the two-year contract period.

Why this change in business model, though? Steady, recurring revenue from millions of users can overcome any lean period, and makes your balance sheet look great any time of the year. 

But there is one major weakness: once the iPhone is unlocked, Apple loses all the money it would have collected over the full period of the contract. And its battle with the enterprising and determined hackers community has taught Apple that there are some battles you just can’t win, and are best avoided.

Also, with the App Store launching, Apple doesn’t need the monthly revenue from the carriers any more. Each application download is going to make Apple money, and that money doesn’t go to the carriers. It is likely that eventually the biggest revenue earner for Apple will be the App Store. Not carrier contracts. And with no monthly revenue to pay to Apple, carriers like AT&T can’t ask for a share of the App Store revenue. Smart.