News reports say that Apple is planning to bring its wildly popular iPhone to Verizon Wireless' network. According to the reports, the deal will make the iPhone available on both AT&T's network and Verizon's as part of Apple's desire to increase the availability of its smartphone.
Although Apple has yet to comment on whether or not the iPhone will be available on Verizon's network, it seems rather likely. In most countries world where the iPhone is available, the smartphone can be used on multiple carrier networks. It's a model that has worked extremely well across Europe and helped Apple increase market share in those countries at an astounding rate.
In the United States, the issue is a bit more complicated, since the iPhone running on AT&T's network is based on GSM technology, while an iPhone on Verizon's network would require CDMA technology. It's not a major technological hurdle, but it's one that so far, Apple hasn't tackled.
Assuming the iPhone does come to Verizon's network this year, consumers should be happy. Verizon has millions of subscribers around the United States who have been waiting for the iPhone. And AT&T customers who might not like the company's network will be happy to know that they can go elsewhere to enjoy the same iPhone experience.
But I wonder if Verizon Wireless will be all that happy about it. Sure, the company might have been working hard to bring the iPhone to its network for quite awhile, but with Apple, it gets more than a phone. As AT&T has learned, Apple's clout can have a powerful (and sometimes negative) effect on carriers. And it can use the iPhone as a weapon to get what it wants.
Verizon might want to think twice about the iPhone. Here's why:
1. Apple commands loyalty
Steve Jobs isn't a slouch when it comes to strategy. He knows how to form the right partnerships that will see his company's products enjoy preferred treatment over the competition. Verizon shouldn't expect him to change his tune when the iPhone comes to Verizon's network. As we have quickly learned from its partnership with AT&T, Apple wants the iPhone to steal the show. AT&T might offer other devices, but it's the iPhone that needs to enjoy the most prominence of all the phones on AT&T's store shelves. What makes anyone think that Apple won't require the same treatment from Verizon?
2. Android isn't so bad
Verizon has helped bring Android devices to the mainstream. Through its partnerships with Google and Android vendors, the company has offered fine alternatives to the iPhone. Granted, they don't sell nearly as well as Apple's smartphone, but they do provide users with an alternative that might keep those subscribers with Verizon. Once the iPhone comes along, all that will change. Verizon's relationship with the Android platform and its control over those smaller vendors will be nothing compared with the relationship it will need to maintain with Apple. Android will seem like a treat compared with an Apple partnership.
3. App Store issues
AT&T has used its partnership with Apple on numerous occasions to block apps from entering Apple's App Store. The company contends that those requests were based on its desire to safeguard its business. In the meantime, the company has caught significant flak for not allowing Apple to add those applications to the store. Verizon Wireless might not want to deal with that. The carrier will undoubtedly ask Apple to reject certain apps. And when that happens, a similar backlash will almost certainly ensue.
4. AT&T still has it
Let's not forget that in the scenario being predicted by the latest reports, Apple would still offer its iPhone on AT&T's network even though the smartphone would come to Verizon's store shelves. Verizon might not like that part of the deal. In recent months, the two biggest carriers in the United States have been gunning for each other over coverage and availability of 3G connectivity. The companies really hate each other. Verizon might be happy to have the iPhone at first, but it almost certainly would rather have it exclusively.