Summary

It's not likely that Apple will push to have the iPhone on the Verizon network. The Droid ads are just one of the reasons. Here's why.

Analysis



It will be interesting to see how the Motorola Droid fares after it's early November launch. There's a lot of hype around it in the tech world, but will the average person care? Most of the items in the first commercial are things that the average person doesn't comprehend (multi-tasking, open development, etc). Of the phones that cost actual money (a large proportion of Blackberrys are cheap or free with plans), the iPhone has the most name recognition with the average person. There's a reason why it's growth has been phenomenal.

Verizon would not launch such an actively negative campaign if they were trying to obtain the iPhone. You don't make friends, even in the business world, by denigrating someone.

If Apple added another carrier to the roster in the US, it would hurt their relationship with ATT. While it's not likely that the two companies really love each other, the iPhone has become increasingly important to ATT, who will be incented to extend their exclusive with Apple as long as they can. That means more money in Apple's pocket. It's not likely that Verizon would be as generous.

Apple saves money by having to design, build, and support only one version of it's phone across the world. Since Verizon uses different cell network technology than ATT (and almost all other service providers in the world), they would have to produce a new revision of the phone for Verizon.

Verizon's current, CDMA, technology does not allow callers to use voice and data at the same time. Sprint's network is under the same limitation. ATT and T-Mobile do not.
It's been stated that one of the reasons why Apple and ATT were able to work out a deal is that ATT let Apple do what they want (pretty much) with the device. Inclusion of WIFI, no ATT branding, no mandatory ATT apps, etc. Verizon is notorious for forcing these kinds of limitations on their phones. For feature phones, Verizon even has a proprietary OS that they require their handset manufacturers to use. Another example is that Blackberrys in other countries have WIFI, but not in the US.

Verizon likes Android because it gives them a modern platform similar to the iPhone, but a) it's cheap and b) they can basically do whatever they want with it. There are reports that Verizon "suggested" changes to the Droid during it's development.

Adding the iPhone to their network would potentially kill off Motorola who has tied their future to the Droid and to Verizon, much as Palm has with the Pre and Sprint. 

So, in conclusion, it's not likely that the iPhone will appear on the Verizon network in the next few years, if ever.


Analyses are solely the work of the authors and have not been edited or endorsed by GLG.