Verizon iPhone a Blow to AT&T

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Verizon may be coming out with its own iPhone next year. USA Today reports:

Verizon (VZ) and Apple (AAPL) are discussing the possible development of an iPhone for Verizon, with the goal of introducing it next year, people familiar with the situation say.

It would mark the first time Apple has produced a version of the iPhone for a CDMA wireless network, which is different from AT&T’s GSM technology. Vodafone, co-owner of Verizon Wireless, already sells the iPhone in Europe.

The New York-based telecom entered into “high-level” discussions with Apple management a few months ago, when CEO Steve Jobs was overseeing day-to-day business, these sources say. They declined to be named because they aren’t authorized to speak publicly.

Jobs is on medical leave until June, but the conversations are continuing, they say. Apple declined to comment.

Nielsen’s Roger Entner, who was interviewed for the report, says that AT&T would be the biggest loser in a Verizon iPhone deal. IPhone users disappointed with AT&T’s reliability would jump ship to Verizon, the article quotes Entner as saying. Meanwhile, Apple would benefit from those users, who would need to buy new iPhones.

PC World comments
:

The news about talks between Apple and Verizon could also be an attempt by Apple to enhance its bargaining position with AT&T over the exclusive contract, Redman said.

But the ultimate value of having the iPhone in the inventory is to attract subscribers to lucrative data plans, the analyst said. Some customers will pay $100 or more a month to have an iPhone voice and data plan just to enjoy iPhone’s superior browsing and other functionalities, they noted.

“If you talk to iPhone users, they will tell you there is no substitute for an iPhone, and without one, you are operating at somewhat of a disadvantage,” Mathias said. “That’s a reason Verizon would want to sell it.”

I hope that Apple goes ahead with the Verizon deal. It’s the best option for consumers, the industry, and Apple itself.

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  • John

    current iphone users wouldn’t necessarily switch unless there were some kind of exchange program, due to the incompatible networks. they would have to wait until they can justify the expense. I suspect those who are really concerned about network quality would have never switched from verizon in the first place – they are the ones who may be waiting most anxiously for an iphone.

  • Rob

    I would switch in a heartbeat if another wireless provider was able to provide an iPhone. AT&T are far beyond hopeless!!!

  • PhoneMonster

    You people at the iPhone are doing a wonderful job, meeting all the expectations and winning all the challenges. BRAVO 2 all of you.
    http://mobilenewz.net/