iPhone on Verizon Wireless

In September of 2008, rumors began to circulate that Apple was going to make a deal to release a CDMA version of their iPhone to be used on the Verizon wireless network. Apple uses a GSM network, so this sounded like an impossible chasm to bridge.

In April of 2009, Apple and Verizon did enter talks about building this bridge. Since then, not much has come out from either company to provide any details about whether a deal had been made, was in the process of being made, or much else.

Currently AT&T has the exclusive rights to distribute the Apple iPhone into 2010.This is according to a deal that was brokered in 2006. Many people in the TelCom industry expect AT&T to attempt to convince Apple to continue the deal. Some have even implied that the deal was for AT&T to have a five-year exclusive contract. If this were truly the case, then Verizon would have to wait until 2012.

Let’s backtrack a moment and discuss what the iPhone actually is.

First and foremost it’s a Smart Phone, which means it acts as a phone, a camera, and a media player. It also has an App Store where customers can download hundreds of applications. iPhones were rather expensive when they first released, costing around $599.00 for the 8 GB model, and closer to $800.00 for the 16 GB version. They have come down to a more affordable price since they came out in 2007. Of course, electronics prices tend to go down after time. There is an old adage that states “Don’t buy it today, it will be cheaper tomorrow.”

For the iPhone to be able to operate on Verizon’s CDMA network would be quite a coup for Verizon, which is currently upgrading its network to a 4th generation wireless technology called “LTE”. If Apple adapts their iPhones to run on this upgraded CDMA/LTE technology, AT&T would lose a great deal.

Verizon offers Apple 80 million customers. While it is certainly possible some might have multiple carriers and have an iPhone, it is more than likely that the vast majority of them don’t.

There is one consideration for the customers of AT&T who already have iPhones that want to continue using them on the Verizon network. If Verizon takes over the iPhone distribution, any customers wanting to make the jump will have to buy a new phone. AT&T has a GSM network, so their customers phones, would literally not work on the Verizon network. Any way Apple goes, they will make a killing.

AT&T would not be completely shut out, though. Apple does not intend to end its association with the TelCom giant. Customers who don’t want to change their carrier and jump to the Verizon network will be able to continue using their iPhones on AT&T.

AT&T has been compatible with Apple for quite some time. For Apple to change the rules at this stage would be a real game changer. It begins to look like Apple and Verizon are attempting to change the way the TelCom market share pie is sliced.

However, all of this is still speculation. Talks have been mentioned in the trade papers, and on the internet, however nothing is written in stone at this stage. Speculation this may be, but it makes for interesting possibilities.


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