Summary
1. When a CEO talks about “build[ing] out its wireless business internationally within the next 5-10 years,” it is clear that it is not a priority. 2. Verizon has a lots on its plate in the US: the 4G network build-out, completing the FiOS infrastructure, penetrating metros outside of its traditional territories to go after large business customers, bolstering its long-haul optical facilities, and probably constructing a high-speed MPLS network. 3. A few of Ivan Seidenberg’s responses omit critical information.
Analysis
On the iPhone, Seidenberg make it sound as if it was totally up to Apple in determining which carrier to choose for the iPhone distribution in the US. Since the phone was just built for the GSM standard, it only made sense to go with AT&T. However, Verizon Wireless passed on the iPhone and it is clear that Apple would have been willing to produce a CDMA-based product. The CEO also talks about his expectation that the “iPhone will blend into the broader industry.” Unless a future agreement is reached with Verizon Wireless, he can only hope that the iPhone ceases to be the leading edge device.
On the issue of FiOS, Seidenberg claims 2001-2002 as being the critical period of developing a “big idea.” Yet, at that time, it was not really any different than what was discussed back in the 1980s – a plan that was going nowhere. It was only later when the FCC decided that the RBOCs did not have to unbundle the fiber if it provided it directly to homes that Verizon saw an opportunity to go past as many Fortune 2000 customers as possible in order to have these higher-margin customers subsidize the residential effort. That Verizon is providing FiOS “equally and fairly every place” is just not true.
Seidenberg also talked about 70% of the footprint will receive FiOS – but, of course, that percentage target is taking into account after the RBOC is finished selling off its less desirable assets over the next several years.
