Katie MarsalThe report from author Sarah Ellison states that the publication has "confirmed" that a Verizon iPhone will be released in early 2011. It noted that the most talked-about phone in America — the Verizon iPhone — is one that doesn't even exist.
The report, which profiles Verizon CEO Ivan Seidenberg's efforts to build the "nation's most reliable" wireless network, notes that Verizon's network will be "assaulted" in early 2011 with millions of new customers using the bandwidth-heavy iPhone. It was an influx of data consuming iPhone users that caused major problems and a public relations debacle for AT&T.
The report detailed how Verizon passed on the iPhone in 2005 because the wireless carrier felt Apple and its chief executive, Steve Jobs, wanted too much control over the sale of the device, and too large a cut of the monthly service fees. It also stated that Apple was wary of building a CDMA iPhone because the wireless technology is not as popular across the globe as it is in the U.S.
"Seidenberg tried to reassure Jobs that Verizon was quickly building a faster 4G (fourth-generation) network, one that would work globally," Ellison wrote of a meeting between the two in 2007. "He also tried to convince Jobs that Verizon had a superior 3G network to AT&T's. Jobs listened politely, as Seidenberg tells it, and agreed to stay in touch."
The two companies allegedly began talking again in December 2007, as AT&T struggled with dropped calls and network issues for iPhone users. The result: a new version of the iPhone 4, compatible with Verizon's 3G CDMA network, set to launch next year.
Verizon's iPhone is expected to offer special features, like live TV for customers of the company's FiOS cable service. It also, according to Fortune, likely will not work outside of the U.S.
Fortune joins a list of reputable news sources that have also confirmed that the iPhone will launch on Verizon's network in early 2011. Earlier this month, The New York Times, The Wall Street Journal, and Bloomberg all independently reported that Apple would release a CDMA version of its iPhone on the Verizon network next year.
The anticipated partnership has also been foreshadowed this week with the sale of Apple's iPad at Verizon stores. Customers can buy a Wi-Fi iPad bundled with a MiFi Intelligent Mobile Hotspot at the same price as an iPad with integrated 3G connectivity.
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55 Comments
The best and worst kept secret no one actually knows about in the business. I love rumors!
I know all signs point to this being true, but there is something that just bothers me...
Why would Apple and Verizon release a CDMA iPhone after the biggest shopping season of the year? Won't both companies lose money on this?
Think about it... Apple releases the iPhone 4 in Jan or Feb, missing out on people who sandbagged their upgrade until the holiday season. If people are happy with their Droids, then that's a loss from Apple in selling them iPhones. Also, a lot of folks on other networks will be beyond their 30-days and will either have to wait longer for a CDMA iPhone or pay an ETF to switch.
But the bigger question is about those 30 day exchanges...and correct me if I'm wrong. Verizon purchases the phones at full price from the manufacturers to sell to consumers (I'm sure there is some bulk discount deal, but you get the picture). Verizon takes a hit for every new phone it sales at a cheaper price and how they make it up is the 2-year contract. But the truth is, they are going to get creamed when a good number of those phones are exchanged within 30 days for the iPhone, which they also purchased for full price. Verizon can no longer sale those returned phones as new and loses money because of the exchanges. When I worked for Sprint, they said the company loses about $170 for every handset that is exchanged or returned. Imagine that for thousands that would exchange what they got for Christmas for the iPhone 4.
It just doesn't seem smart for either parties...
Fortune joins a list of reputable news sources that have also confirmed that the iPhone will launch on Verizon's network in early 2011. Earlier this month, The New York Times, The Wall Street Journal, and Bloomberg all independently reported that Apple would release a CDMA version of its iPhone on the Verizon network next year.
Man, if this turned out not to be true, all these "reputable news sources" would have egg on their faces.
I know all signs point to this being true, but there is something that just bothers me...
Why would Apple and Verizon release a CDMA iPhone after the biggest shopping season of the year? Won't both companies lose money on this?
Off the top of my head...
If you look at the world of product releases there are announcements and releases in the months following the Holiday quarter so this wouldn?t be an unusual occurrence by any stretch. Why did Apple announce the original iPhone on January 7th 2007, instead of selling it months earlier?
I know all signs point to this being true, but there is something that just bothers me...
Why would Apple and Verizon release a CDMA iPhone after the biggest shopping season of the year? Won't both companies lose money on this?
Think about it... Apple releases the iPhone 4 in Jan or Feb, missing out on people who sandbagged their upgrade until the holiday season. If people are happy with their Droids, then that's a loss from Apple in selling them iPhones. Also, a lot of folks on other networks will be beyond their 30-days and will either have to wait longer for a CDMA iPhone or pay an ETF to switch.
But the bigger question is about those 30 day exchanges...and correct me if I'm wrong. Verizon purchases the phones at full price from the manufacturers to sell to consumers (I'm sure there is some bulk discount deal, but you get the picture). Verizon takes a hit for every new phone it sales at a cheaper price and how they make it up is the 2-year contract. But the truth is, they are going to get creamed when a good number of those phones are exchanged within 30 days for the iPhone, which they also purchased for full price. Verizon can no longer sale those returned phones as new and loses money because of the exchanges. When I worked for Sprint, they said the company loses about $170 for every handset that is exchanged or returned. Imagine that for thousands that would exchange what they got for Christmas for the iPhone 4.
It just doesn't seem smart for either parties...
There is a huge pent up demand for a Verizon iPhone. I will probably switch from my Droid to the iPhone ( if any of this is true. I still have my doubts ). I suspect a lot of people currently using a Droid will switch as well. The problem is that the new Android phones are now as locked down as the iPhone. It was the one real reason why someone might want an Android phone over an iPhone. Also the last majoy Androidn Update ( Froyo ) broke several major features. For example, most phone can no longer log into a infrastructure Corporate Wifi. It is just a bug in Froyo, but Google is not going to offer a fix any time soon. They destroyed the audio quality of any streaming service that uses AAC+ encoding. I used to love Pandora. The audio quality is so bad with Froyo, I can't stand to listen to it any more. There are many other issue like this with the latest Android update and Google is doing NOTHING to solve the issues. The only area where Android is better than the iPhone is:
1) Google Maps and navigation is significantly better in Android.
2) The Voice Commands are excellent in Android.
3) I like being able to mount the phone as a USB drive to move files back and forth...
4) You can customize the appearance of the Android phones more if you want to ( not a big deal.. )
Other than that, the iPhone wins hands down...
I think Apple will sell a several million right off the bat....