My Prediction: Why the rumored CDMA iPhone won’t be coming to Verizon

If you are an iOS device owner praying to switch to Verizon, I may have some bad news for you.  Obviously nothing is set in stone and this is only my opinion, but let me paint you a picture of why Verizon won't be getting the iPhone.

I’ve seen a few articles mentioning a CDMA version of the iPhone coming out sometime soon, one like this: http://www.engadget.com/2010/08/11/cdma-iphone-in-engineering-tests-may-arrive-in-january-says-jo/

Now if you are an iOS device owner praying to switch to Verizon, I may have some bad news for you.  Obviously nothing is set in stone and this is only my opinion, but let me paint you a picture of why Verizon won’t be getting the iPhone.

Money

Verizon loves money

First, we should probably start off saying all companies love money.  But two companies that don’t really budge when it comes to money? Apple and Verizon.  So let me transport you back to 2005 or 2006 and Apple Sales guys go over to Verizon and they’re like, “Hey Verizon, we really like your service and would like to have our phone in your lineup.  Can we talk?”  And then the Verizon dude was all, “Sure, sounds great!”

So there is Apple Sales and Verizon Sales sitting down having some soul crumpets and having a little chat and before long Verizon sales guy is getting interested.  Now that his curiosity is piqued he wants to get to the bottom-line, “So after we subsidize your phone, what are you looking to make?”  And the Apple sales guy was like, (short version) “well all told we like you to pay us about $524 per phone when you average them out between both capacity versions.”  The Verizon sales guy would then laugh and slap his knee and look at the Apple sales guy waiting for him to reveal the joke.  When no joke was revealed, the Verizon sales guy says, “Get out.”

Source for info: http://tech.fortune.cnn.com/2008/06/19/what-att-pays-apple-for-the-iphone/

Sometime in the future the Google Sales guy and Verizon sales guy talk about a free OS they can put on phones, but I’ll get onto that later.

On to the second reason:

Leverage

Who controls who?  Normally you’d think that the carrier has the control.  But in the weird Apple bubble, Apple dictates to AT&T how things are gonna be going down.  Look at the iPhone.  It is devoid of any markings that it’s an AT&T device.  It’s not called the AT&T iPhone.  Like-wise Apple would never let Verizon call it the “Verizon iPhone”.  But in the US, many of the complaints when the iPhone fails are not attributed to the device, they are placed on to the service provider: AT&T.  Which has led to many people beseeching Apple to provide a Verizon version.

There is obviously one big thing like a contract until 2012 that prevents Apple from selling the iPhone with other US carriers.  The rumored CDMA iPhone is slated for a January 2011 release which is a full year ahead of when the contract is supposed to expire, but perhaps the contract was signed earlier than 2007?  Who knows,  the only thing that is certain is the AT&T has a 5 year exclusivity contract with the iPhone and the original came out in 2007.

Source:http://www.zdnet.com/blog/btl/apple-at-t-had-five-year-exclusive-iphone-deal-but-have-the-terms-since-changed/34280

So Verizon originally dismissed Apple with the iPhone and now they know consumers want Verizon to carry the iPhone.  Verizon has the upper hand here and Apple is going to have to kowtow to what Verizon expects.  Namely, paying much less than what AT&T pays Apple, the “name” of the device and what comes on the device by default.  I sincerely doubt that Apple would allow “Vcast” and “Vstore” to be the default portals to deliver content to consumers. Which leads to my next point:

Apple don’t play that

Apple doesn’t get told what to do.  Apple tells everybody else what to do.  And if Apple wants to get on Verizon, Verizon has a list of demands.

  1. They pay Apple what they pay everybody else. (not happening)
  2. It can still be called the Apple iPhone, but it just has to be called the Verizon Apple iPhone. (Perhaps Apple would allow this)
  3. By default, the Verizon Apple iPhone must use the Verizon App Store which Verizon gets a cut of and instead of iTunes to deliver video, by default Vcast needs to deliver this content.  Again so Verizon can make money from this. (I could almost say 100% that Apple would never let happen.)

I mean, basically, what you have here is an unstoppable force meeting an unmovable object.  These two companies just can’t see eye to eye on anything.  There is going to be some long drawn out deals being discussed (which probably have happened already) but as far as I can see it

source:http://www.pcworld.com/article/168361/verizons_app_store_plans_likely_to_irk_phone_makers.html

The Writing is already on the Wall

Verizon is currently heavily promoting their “Verizon Droid” line-up.  The cost of the OS is bupkis and is starting to have a usability parity with the iPhone and has long since past the functionality parity.  The cherry on top is the assault of Android powered devices headed to Verizon in 2010 alone! http://www.engadget.com/2010/08/18/verizons-remaining-2010-roadmap-to-be-an-android-fest-of-phones/

So for me, I don’t see this rumored CDMA iPhone coming to Verizon anytime soon.  The only other US CDMA company that is looking to grow it’s user base and is willing to agree to all of Apple’s terms is… Sprint.

But that’s just my prediction.

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