Analyst: AT&T to Share iPhone with Verizon in 2010

| Apple Stock Watch

AT&T has been Apple's exclusive iPhone partner in the United States ever since the combination iPod and smartphone was introduced, but that will change in 2010. Broadpoint AmTech analyst Brian Marshall expects Apple will branch out and strike an iPhone deal with Verizon next year.

"While Apple started off with exclusive arrangements in 2007 with the original iPhone launch, the company has since migrated towards multiple carriers per region," Mr. Marshall said. "In our view, diverse carrier support is a key element to driving global penetration of the iPhone. Therefore, we believe the chances are high the iPhone will find its way onto the Verizon network in the second half of 2010."

Verizon has already expressed interest in carrying the iPhone on its cell network. "We obviously would be interested at any point in the future they thought it would make sense for them to have us as a partner. And so we will leave it with them on that score," said Verizon CEO Ivan Seidenberg during his company's quarterly earnings report earlier this week.

AT&T executives have acknowledged in the past that their exclusive deal with Apple would eventually end, too.

Mr. Marshall is maintaining his "Buy" rating and US$235 target price for Apple's stock. Apple is currently trading at $193.13, down 4.24 (2.15%).

Comments

Lee Dronick

“While Apple started off with exclusive arrangements in 2007 with the original iPhone launch, the company has since migrated towards multiple carriers per region,”

What?

John Molloy

Certainly in France, UK and Canada… Sir!

But as to Apple going to Verizon - after the Droid campaign I very much doubt it.

Lee Dronick

Yes rattyuk other countries to be sure, but in the USA how do we know that Apple has migrated towards other carriers. I don’t think that a Sprint or Verison kiosk outside of an Apple Retail Store at a shopping mall constitutes migration.

John Molloy

Indeed - as far as we know AT&T is it - and as we know analysts have their fingers closely on the button on this one. grin

Remo

The so called “analyst” seems to forget that Verizon uses CDMA technology (and will continue to for voice even with their roll out of LTE) and the iPhone in every market uses GSM.  Unless you can get Verizon to switch to GSM in the next year that analyst is all bark and no bite.

Peter

Well, this would mean that Apple is doing a CDMA phone.  I’m not convinced that’s the case.

Yes, Verizon would love Apple to do a CDMA phone.  If Apple does it, I’m sure that Verizon would pick it up in a heartbeat.  That’s what the Verizon exec meant when he said that the ball is in Apple’s court—if Apple builds it, Verizon will come.

The question is, does Apple have any interest in doing so?

The biggest user of CDMA is, of course, Verizon here in the US.  Outside the US, not so much.  I think most of the markets have a CDMA carrier, but I think it’s only Verizon that has a sizable chunk of any one market.

CDMA will be fazed out over time for LTE.  While Verizon will support LTE for data, voice will continue to run over CDMA for awhile here in the US.  While other markets may switch, it’s a gradual transition probably for the next 5-10 years.  Now, that’s quite awhile and it might be worthwhile for Apple to consider a CDMA/LTE cellphone for those markets.  But only Apple really knows for sure.

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