AT&T paid dearly for iPhone exclusivity that started in June 2007 and ran for nearly four years. What did it buy? Back in 2Q07, AT&T Wireless generated $10.4 billion in sales, and Verizon Wireless did $10.8 billion. Verizon Wireless edged out AT&T by just 4%. This was a very interesting point in time to inject a revolutionary new smartphone — and the iPhone debuted just two days before the end of 2Q07.

Whichever carrier landed the iPhone was always destined to lose the exclusivity after a couple of years. Sure enough, Verizon’s iPhone debuted in 1Q11 and Sprint followed about half a year later. AT&T had nearly four years of iPhone exclusivity, which is an eon in consumer electronics.

Let’s fast-forward to 1Q12. AT&T Wireless had reached sales of $16.1 Billion, and Verizon Wireless hit $15.4 Billion. So over the past five years, AT&T flipped from lagging Verizon by 4% in revenue generation to leading it by 5%. Much of this had to do with AT&T’s faster growth of smartphone subscribers, obviously driven by the iPhone glamour.

Back in 2Q 2007, AT&T Wireless adjusted operating income margin stood at 25.5%. In 1Q 2012, profit margin expanded to 27.2%.

In 2Q 2007, Verizon Wireless had operating income margin of 27.8%. That ticked up to 28.6% by 1Q12. The 80 bp increase is a touch less than half of the margin expansion AT&T delivered over the same time span riding the iPhone wave.

And that is perhaps the most interesting part of this clash of two U.S. carrier behemoths. It certainly seems that the iPhone helped AT&T to swing to a small, but clear lead over Verizon when it comes to sales. It is plausible that iPhone also helped AT&T to boost its wireless margins by about 170 basis points.

But I find it intriguing that the four-year period of iPhone exclusivity did not dent Verizon’s profitability by one iota. Verizon simply used the Android wave to create its own smartphone subscriber surge and then added iPhone support four years after AT&T… without losing any profit margin luster.

It can certainly be argued that buying the iPhone exclusivity was the right move for AT&T Wireless. The Big T gained a leg up on Verizon in revenue sweepstakes and bounced its margins a bit. But it is fairly amazing how well Verizon navigated its years of not having the iPhone. Verizon’s Android stable turned out to be strong and tempting enough to siphon off enough high-spending, wealthy subs to avoid any margin erosion over the past half a decade. Not a mean feat.

Four years of iPhone exclusivity jacked up AT&T’s wireless profit margin by 170 bp. Nothing to scoff at. But a brief look at Apple’s profit explosion since 2007 tells us who ended up reaping 95% of the benefits from that relationship.