iPhone sales shift set to shake up US telecoms

Jan 11, 2011
AT&T's monopoly on carrying the iPhone in the United States is expected to near its end Tuesday, when its rival Verizon announces a deal to begin selling Apple's coveted device.

AT&T's monopoly on carrying the iPhone in the United States is expected to near its end Tuesday, when its rival Verizon announces a deal to begin selling Apple's coveted device.

For more than three months rumors have swirled that a deal between and Apple was in the pipeline.

A press conference scheduled for Tuesday is expected to finally end the mutterings, according to industry sources, and signal a shakeup of the lucrative US mobile market.

Since the was launched in 2007 would-be US customers have been trammeled toward AT&T, the sole carrier of the coveted smartphone which has sold in the tens of millions.

"The (Verizon) iPhone launch will be important," said James Ratcliffe of Barclay's Capital, predicting a boon for Verizon customers and sales of 15 million iPhones next year.

Apart from the now inevitable sales battle, Verizon's iPhone launch will also bring a long-looming technology fight to the fore.

Providers have been moving to phase out unlimited data plans, seeing restrictive caps as more cost effective, and a way of recouping lost fixed-line revenue.

But according to Ratcliffe it is "surprising" that Verizon will opt to give customers unlimited data plans, putting pressure on AT&T, which recently ended a similar iPhone plan in favor of a cap.

Douglas McIntyre of 24/7 Wall St. said "the move by Verizon is likely to cause the one thing that wireless providers have hoped to avoid -- price wars."

Most analysts now expected Verizon to roll out the iPhone by early February, but the impact of AT&T's lost exclusivity is already being felt.

Since the first reports of a Verizon-Apple deal surfaced late last year Verizon's shares are up nearly 10 percent.

On Monday AT&T's shares fell over four percent.

The company has been riddled by complaints about shoddy coverage, particularly in the populous northeast of the United States.

But ripples are also being felt beyond the providers immediately affected.

Until now Verizon has lavished much of its attention, and advertising dollars on devices running Google's Android applications.

"We think VZW (Verizon) will notably promote the iPhone, at least initially, especially relative to the attention, investment, (Google's) Android devices previously received," said Scott Kessler of Standard & Poor's Equity Research.

But AT&T may return the favor, taking more interest in Android-based phones, and offsetting Google's demotion on the Verizon podium.

"We expect Android-related sales will remain strong, given lower prices, proliferation beyond smartphones, and growing interest from AT&T in Android based phones," said Kessler.

Explore further: Amazon launches 3D printing store

add to favorites email to friend print save as pdf

Related Stories

Verizon CEO has told Apple of iPhone interest

Apr 06, 2010

(AP) -- Verizon CEO Ivan Seidenberg says the company has told Apple that it wants to carry the iPhone. But he declined to say when - or even if - the popular smart phone will be available for Verizon Wireless customers.

CDMA iPhone may be coming soon

Jan 06, 2010

(PhysOrg.com) -- The largest wireless carrier in the US, Verizon Wireless, is thought to be in negotiations with Apple to release a CDMA network version of the iPhone later this year, if a price can be agreed ...

Verizon iPhone in Q1 not a rumor any longer

Oct 07, 2010

(PhysOrg.com) -- Today the Wall Street Journal changed a few things in its Verizon iPhone story from yesterday. Unnamed sources are now stating that Verizon Wireless will be selling a CDMA version of the Apple ...

Verizon's big ad push for Android takes on iPhone

Oct 19, 2009

(AP) -- An aggressive TV ad campaign from Verizon Wireless is adding to the support building for a software package from Google Inc. that is shaping up to be the most formidable challenge yet to Apple Inc.'s ...

Recommended for you

Chinese smartphone makers win as market swells

5 hours ago

Chinese smartphone makers racked up big gains as the global market for Internet-linked handsets grew to record levels in the second quarter, International Data Corp said Tuesday.

Full appeals court upholds labels on meat packages

5 hours ago

(AP)—A federal appeals court has upheld new government rules that require labels on packaged steaks, ribs and other cuts of meat to say where the animals were born, raised and slaughtered.

BlackBerry buys German anti-eavesdropping firm

6 hours ago

Canadian smartphone maker BlackBerry announced Tuesday the purchase of German voice and data encryption and anti-eavesdropping firm Secusmart, whose customers include NATO and German Chancellor Angela Merkel ...

India's Flipkart raises $1 bn to tackle Amazon

7 hours ago

India's top e-commerce company Flipkart said Tuesday it had raised $1 billion (60 billion rupees) in funds as it battles US giant Amazon for supremacy in the hyper-competitive local market.

User comments : 0