Neil Hughes
Analyst Shaw Wu with Kaufman Bros. cited checks with industry sources in a new note to investors issued on Wednesday, in which he said Verizon will put its "marketing muscle" behind the iPhone. The advertisements are expected to come at the expense of competing smartphones that run the Google Android mobile operating system.
"On its homepage, [Verizon] is already highlighting the iPhone 4 and iPad as flagship products with not much else in sight (save for a Jabra Bluetooth Headset)," Wu wrote.
When Verizon began selling the iPad late last year, the company ran an aggressive ad campaign on TV touting the device's availability. AT&T, on the other hand, had no TV commercials devoted solely to the iPad.
When the iPhone was not on Verizon, the carrier ran a number of campaigns that instead pushed Android as part of the company's "Droid" lineup, including one commercial that portrayed the iPhone as feminine. The series of commercials said that what the iPhone couldn't do, "Droid Does."
Now, with a partnership between Apple and Verizon, Android will face its "first true test," Wu believes. He said while many are interested in seeing how many customers move from AT&T to Verizon, he believes the better question is how many Android users on Verizon decide to switch to an iPhone.
The analyst also commented on the fact that the deal between Apple and Verizon is non-exclusive, a fact that could leave open the possibility of additional carriers in the U.S. like Sprint and T-Mobile. Because the iPhone remains only on Verizon and AT&T at the moment, Wu said it is "effectively exclusive."
"We will be surprised to see if it appears on T-Mobile USA and/or Sprint in the near term, though admittedly with AAPL, sometimes the unpredictable happens," he said.
Kaufman Bros. has a 12-month price target of $395 for AAPL stock, based on a calendar year 2011 earnings per share forecast of $20.05. Wu sees Apple selling 63 million iPhones in calendar year 2011, with Verizon contributing an incremental 2 million to 3 million unit sales per quarter.
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61 Comments
I like it as an Apple share holder but the fact Verizon and AT&T too, stab whoever isn't their favorite flavor of the week in the back, is a bit sickening really when you think about it. But ... I know 'it's a cruel, hard World out there, get used to it'
I like it as an Apple share holder but the fact Verizon and AT&T too, stab whoever isn't their favorite flavor of the week in the back, is a bit sickening really when you think about it. But ... I know 'it's a cruel, hard World out there, get used to it'
It's call capitalism- competition. Haven't you ever seen an "I'm a Mac, you're a PC" advertisement?
I like it as an Apple share holder but the fact Verizon and AT&T too, stab whoever isn't their favorite flavor of the week in the back, is a bit sickening really when you think about it. But ... I know 'it's a cruel, hard World out there, get used to it'
Not cruel at all. It's all about biz with these corps. They can turn around any thought, campaign, whatever if it means profits. The users are way more invested in the this vs that technology. That's why you can't insult a salesman. As long as you are still in the market for his/her product, you'll get more "love" than you can handle.
It's call capitalism- competition. Haven't you ever seen an "I'm a Mac, you're a PC" advertisement?
But you do not see Apple working with HP or IBM to put iLife or iWork on a PC.
The WiFi tethering feature alone could be two or three different ads. Man, if you thought the "map" ads were rough... This is going to be a real donnybrook!
I agree that the next series of wireless ads is going to drive the iPhone mind share much more than it is going to help either Verizon or AT&T. Android phones will be probably be the real loser in this advertising brawl, at least in the short term.