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I know very little about the smartphone market, but in the console market, Sony were happy to sell the Playstation at a loss to get the hardware out there.

Is this what you are predicting for the smartphone arena? Having the hardware at increasingly lower prices in order to make money on the app sales?

Surely, this is the only logical conclusion if Nokia move into an app store-like closed marketplace?

That only works as long as the console makers mostly lock out unlicensed applications from their platforms. Only AT&T and Apple seem to be willing to take this route.

Now, we have tons of carrier-subsidized phones that come with a service contract. (You get a cheap phone, but you have to pay $80/month for the next couple years.) That seems to be where the money is in phones.

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