Katie Marsal
In a new report filed Thursday, iSuppli Corp. predicts that Apple will extend its exclusive deal with AT&T next year, based on anticipated growth of High Speed Packet Access technology being adopted by the wireless carrier. The report states that HSPA subscribers are projected to hit 1.4 billion in 2012, while competing standard EVDO, used by Verizon, will have only 304.6 million users by 2013.
"Speculation is rife that Apple will end its exclusive U.S. iPhone service deal with AT&T when the current contract expires in June 2010 and begin to offer phones that work with the Verizon network," said Francis Sideco, principal analyst, wireless communications. "However, iSuppli doesn’t believe this will be the case."
But the same report questions whether extending the contract with Apple would be a good idea for AT&T. It states that the iPhone has been a "mixed blessing" for the wireless carrier, bringing new subscribers but creating bandwidth shortages across the network.
"Facing dropped calls, service interruptions and slow download speeds, iPhone users in certain markets are blaming AT&T," said Jagdish Rebello, director and principal analyst. "iPhone users are overloading AT&T’s network with data traffic generated by the download and usage of apps. However, the real problem is that AT&T has not found a way to monetize data traffic generated by the iPhone."
In recent weeks, AT&T has conceded that its network performance has been less than optimal. In response, the company has vowed to improve, and plans to invest more than $17 billion in the next year to improve its wireless service.
However, the report suggests that Apple could still strike a wireless data deal with Verizon — but for a product other than the iPhone. The report states that there is no evidence that the current contract with AT&T would prevent Apple from going to Verizon for its long-rumored tablet device, a connected iPod touch, a netbook, or perhaps a new model of the iPhone.
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130 Comments
However, the report suggests that Apple could still strike a wireless data deal with Verizon -- but for a product other than the iPhone. ... or perhaps a new model of the iPhone.
Talk about waffling.
The article states that Att will invest 17 billion in its wireless network. I believe what the Deathstar company actually said was it would invest 17 billion in its entire network which would include its land lines, dsl service, etc.
The thing iSuppi is overlooking is Verizon's massive push to incorporate 4g technology into it's network, which will be HSPA compatible. Apple would be right to avoid an EVDO-based phone, and won't need it to work with Verizon come next year. The ATT iphone userbase is almost saturated, it would be completely asinine to extend an exclusivity deal with them, when they can sell many more iphones by opening up to Verizon 4G when that network comes to fruition next year.
I don't doubt they'll continue to offer the iPhone through AT&T, but why on earth would they extend an exclusivity contract? Seems to me at least one other carrier out there must be willing to bend to Apple's demands to get a piece of the iPhone pie. AT&T would be crazy at this point to hit Apple with an exclusivity ultimatum.
maybe part of that 17 billion will be a exclusive signing bonus to Apple??
I can't see why Apple would extend the exclusivity, considering the current status of the saturated data network of AT&T.