Trump Organization enters mobile phone business Clutch Fire

Donald Trump’s family business is launching a new Trump-branded phone service, in its latest plan to cash in on the US president’s name.

The Trump Organization, which is run by his sons, said it planned to sell a gold-coloured, “built in the United States” smartphone for $499 (£367.50), along with mobile phone service for a monthly fee of $47.45 – a reference to their father serving as the country’s 47th and 45th president.

Ethics watchdogs said the latest venture represented another means for potential corruption and conflicts of interest.

A supply chain expert has also told the BBC that making such a phone in the US from all-American components would be “virtually impossible.”

“It’s unbelievable that the Trump family has created yet another way for President Trump to personally profit while in office,” said Meghan Faulkner, communications director for Citizens for Responsibility and Ethics in Washington (CREW).

Trump has said he has put his business interests in a trust, which is managed by his children. The White House has maintained he acts on the interests of all Americans.

But Ms Faulkner said the latest venture raised familiar issues, including whether the new business will win customers from people hoping to influence Trump and how the president will craft policies and regulation for an industry in which his family now has a stake.

Technology experts have questioned what the Trump Organization’s “built in the United States” claim about its handsets means and argued it is probably not currently possible to manufacture smartphones from scratch in the US.

“They don’t even have a working prototype. It’s extremely unlikely,” said Professor Tinglong Dai, who teaches operations management at Johns Hopkins’ Carey Business School.

“You would have to have a miracle. You would need to have economies of scale. You would need to have sustainable demand for this kind of product,” Prof Dai added.

The decision comes as Trump tries to pressure Apple chief executive Tim Cook to manufacture iPhones sold to American buyers in the US.

Last month, the president threatened to place a 25% import tax “at least” on iPhones not manufactured in America.

Analyst Leo Gebbie of CCS Insight noted that the US currently “simply does not have the high-tech supply chain” required for smartphone assembly, especially not in time to be released in August, as the Trump Organization has said.

“However, it’s possible that the device could be assembled in the US with parts imported from abroad. This might be the most likely outcome that lets the T1 claim American sovereignty,” Mr Gebbie said.

The announcement was light on details, including the name of the business partner that will run the service and is licensing the name.

The Trump Organization did not immediately respond to questions from the BBC about its business partner, criticisms around potential ethics issues and a request for details of its “built in the United States” claim.

In announcing its plans, it said “hard-working Americans deserve a wireless service that’s affordable, reflects their values, and delivers reliable quality they can count on”.

It pitched a policy of “discounted” international calls to families with members serving outside the US in the military.

The announcement said the mobile service would have customer support staff based in the US to answer questions, as well as the gold-coloured phone, which is currently available for pre-order.

The deal is an extension of a business strategy that Trump embraced long before his presidency, striking deals to sell his name to hoteliers and golf course operators in exchange for fees and royalties.

But the opportunities to profit from his brand have expanded since he entered politics a decade ago.

On his most recent financial disclosure, Trump reported making more than $600m last year, including millions from of items such as Trump-branded bibles, watches sneakers and fragrances.

Forbes in March estimated his net worth was $5.1bn, more than double than a year earlier.

It said the surge was due in part to the president’s “diehard following”, which is credited with helping to prop up the value of Trump’s social media company that runs the Truth Social platform, which accounted for roughly half his wealth last year.

The mobile phone market in the US is currently dominated by three major players: AT&T, Verizon and T-Mobile, which all offer phone service starting at less than $40 a month.

There are also a growing number of smaller firms paying to use those networks to target niche groups of potential customers, by offering lower prices or tailored plans.

The largest of those companies, which are known as mobile virtual network providers, have less than 10 million subscribers, according to a 2024 report by the Federal Communications Commission.

Mint Mobile, which was backed by Ryan Reynolds, was sold to T-Mobile for $1.35bn in 2023. At the time, one analyst estimated the service had roughly two million to three million subscribers.

The actor had a 25% stake in the business, giving him a potential pay out of about $300m.