Apple's iPhone will launch on Verizon in early 2011, predicts Barclays Capital analyst James Ratcliffe, based on channel checks by the firm's communications equipment and semiconductor research partners. Ratcliffe foresees Verizon activating 9 million new iPhones by the end of the year, most of them for existing Verizon subscribers wanting to switch devices. The analyst also predicts that a Verizon iPhone could lead to between 500,000 and 1 million customer defections from AT&T.
Apple's iPhone will launch on Verizon in early 2011,
predicts Barclays Capital analyst James Ratcliffe, based on "channel checks by
our communications equipment and semiconductor research partners." However, he
added in a June 22 research note, the device's appearance on a new carrier will
not be the game-changer that some have predicted.
The "iPhone would be a plus for Verizon, but not a seismic
industry change, given the relative stickiness of smartphone customers,"
Ratcliffe wrote in his note, circulated to the firm's clients. "[The] primary
source of Verizon iPhone [subscribers] would be pent-up demand by existing
Verizon [subscribers]." Because of that, the number of postpaid Verizon
subscribers would only increase by 900,000 in 2011, Ratcliffe predicts, even as
Verizon activates some 9 million new iPhones by the end of that year.
Ratcliffe predicts that between 500,000 and 1 million
AT&T customers, dissatisfied with their carrier service, could jump with
their iPhones onto Verizon's network. He also thinks that an initial Verizon
iPhone will not be Long Term Evolution (LTE) 4G capable, despite
Verizon's continuing development of that faster standard for its networks.
"While it would make sense from Verizon's perspective to
have the first Verizon iPhone coincide with the LTE launch," Ratcliffe wrote,
"it appears unlikely that [Qualcomm] will have a dual-mode voice and data
chipset commercially available in time for a [first quarter 2011] launch. This
does not entirely preclude an LTE iPhone, however, as Apple could elect to
incorporate separate chipsets for voice and data."
If the initial iPhone release is not LTE-capable, Ratcliffe
added, "we would expect the first refresh cycle (likely later in 2011E) to be
Were an iPhone to debut on Verizon within the year, logic
dictates it would be the latest-generation iPhone 4. During a keynote
presentation June 7 at Apple's 2010 Worldwide Developers Conference, Apple CEO
Steve Jobs referred to the iPhone 4 as "the biggest leap since the original
to a live transcript of the event
, adding: "This is beyond doubt one of the
most precise, beautiful things we've ever done."
The iPhone 4 currently retails with a two-year AT&T
contract for $199 for the 16GB version, and $299 for the 32GB version. Features
include a front-facing camera for video conferencing and the new iOS4 operating
system, previously dubbed "iPhone OS 4," which includes new-to-the-iPhone
features such as multitasking.
Apple and AT&T encountered issues during the iPhone 4's
first day of preorder availability, June 15, as enormous customer demand led
to a systemic meltdown of the companies' ordering systems. Reports circulated
online of AT&T employees forced to jot customers' details on paper after
store computers crashed, and visitors to Apple's Website encountered error
"It was the largest number of preorders Apple has ever taken
in a single day and was far higher than we anticipated, resulting in many order
and approval system malfunctions," read a June 16 statement on Apple's Website.
"Many customers were turned away or abandoned the process in frustration. We
apologize to everyone who encountered difficulties."
executives have indicated that an iPhone on their company's network
a question of "when" than "if."