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Verizon Exec: Apple’s Doing It Wrong, But We Want iPhone

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5:07 PM, Oct. 26th ET, 2009
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Verizon CEO Ivan Seidenberg delivered a mixed message concerning the iPhone on Monday. In his company's quarterly conference call with analysts, Mr. Seidenberg saluted Apple's success with the iPhone, even while suggesting that his company's goal of offering choice to customers was the better route. He also made it clear that his company was still interested in carrying the device.

Writing for The Wall Street Journal's blogs, Andrew LaVallee reported that Mr. Seidenberg said, "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."

On the positive side, he noted that, "What [Apple has] done has been successful, so we have to sit back and give them credit for that."

This is an acknowledgement that Apple's decision to form exclusive partnerships with a single carrier -- AT&T in the case of the U.S. -- hasn't kept the company from gaining significant market share in the smart phone market. Some industry observers had predicted that the iPhone would find a limited audience with just one carrier, while today many analysts have said that Apple could see significant growth of its platform if it were to end the exclusivity agreement with AT&T.

What's interesting is that Mr. Seidenberg then followed that statement up with one that effectively condemned the same approach he had just praised, saying, "Our view is to broaden the base of choice for customers, and hopefully along the way, Apple, as well as others, will decide to jump on the bandwagon."

Other tidbits from the conference call include the news that Verizon will be opening its own app store for smart phones in 2010.

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19 Observer Comments

Flip, meet flop.

   Actions John Martellaro said on October 26th, 2009 at 4:24 PM (Edited: 07/29/2011 1:39 PM):

We’ve all seen the Verizon TV ad: “There’s a map for that.”  But it just occurred to me that there’s more to those two maps than meets the eye.  AT&T can reach 90% of the U.S. population without saturating the geography (in blue, in the ad). That’s due to heavily populated metro areas on the east and west coast.

On the other hand, what looks like more than double the geographic coverage (in red, in Verizon’s ads), doesn’t guarantee double the # of customers.  It just suggests that Verizon has picked up more of the remnants in the rural areas. At additional cost.

As always, a clever map doesn’t tell the whole story.

   Actions Lee Dronick said on October 26th, 2009 at 4:43 PM (Edited: 10/18/2011 6:20 PM):

John, good point about population density and AT&T coverage.

I am anxious for AT&T to offer tethering with the iPhone on their fast 3G network, but for now “I will have a cherry lime ricky and a hard boiled egg.”

If the game was just about hitting the most amount of people with least amount of area then there would be no cell coverage outside of major cities and freeways.

The gist of Mr. Seidenberg’s comments is that the iPhone’s feature set as we know it does not mesh with Verizion’s priorities, and it is up to Apple to agree to cripple it as directed. Jobs won’t, so “it’s all Apple’s fault” there is no iPhone on Verizon.

Verizon may have the better network, but until they have a top management that doesn’t view their customers as targets for being ripped off (ask me how I know), we will not see an iPhone on Verizon.

My contract with Verizon has finally expired, Mr. Seidenberg! I am a free agent, and I hate being treated as a victim. Guess what…

   Actions Brad Hutchings (Bosco) said on October 26th, 2009 at 5:52 PM (Edited: 10/12/2011 8:04 PM):

John, nice theory. But I live where people live, in South Orange County, CA. AT&T coverage for my iPhone has been just plain crappy compared to my old Sprint phone. And my friends with Verizon don’t seem to have a dead spot inside or outside down here. Some of the worst dead spots for AT&T are inside houses.

A month ago, my folks were up at their boat for a week on Lake Oroville in NorCal. We had a little family emergency and I couldn’t get ahold of them for 2 days on their AT&T phones. They tell me that someone on the dock has a Verizon phone that works there. And it’s in an area that is in AT&T’s 3G coverage map!

   Actions John Martellaro said on October 26th, 2009 at 6:11 PM (Edited: 07/29/2011 1:39 PM):

Bosco: Some of that has to do with the frequency of the local AT&T tower.

http://www.ipodobserver.com/ipo/article/understanding_and_optimizing_iphone_power_management/

In the Denver area, AT&T was using a lot of 1900 MHz.  May have been legacy frequencies.  Anyway, when they introduced 850 MHz, things went better in spots. I could even see an improvement at my house.

Lower frequency means longer wavelength—which penetrates houses better.

If only Sprint (with its 3rd-rate CDMA network) would do the deal with Apple soon, before it gets gobbled up by Verizon (with its huge/1st-rate CDMA network), then a Cingular-to-ATT-type iPhone deal would “deja-vu all over again” the iPhone into ATT through the back door, without allowing ATT to work out any deal of its own with Apple prior to inheriting its own iPhone from Sprint.

... then a Cingular-to-ATT-type iPhone deal would “deja-vu all over again” the iPhone into ATT through the back door, without allowing ATT to work out any deal of its own with Apple prior to inheriting its own iPhone from Sprint.

OOPS - I meant to say, “... without allowing Verizon to work out any deal of its own…” (Sorry.)

I love my iPhone…  Couldn’t live without it….  The day Verizon has the iPhone is the day I say good bye to AT&T, penalty or not.  I came off Verizon, and paid for early termination to get the iPhone.  AT&T service in my area (Dover, DE) sucks compared to Verizon.  Way too many dead spots.  I also have more dead spots and call cut offs as I travel the East Coast, compared to Verizon.

Apple…  Make the deal already!  smile

I wonder if what is meant by “broaden the base of choice for customers” is the exact opposite of what Apple does best. Do customers really want to choose among 57 varieties of iPhones based on calling plan, location, carrier, phase of the moon?

Since Apple is “doing it wrong” and is still making bank, then perhaps the “right” way is not so good. Apple’s way is “wrong” for Verizon, but not for customers and not for Apple.

Perhaps Mr. Seidenberg isn’t an engineer, but he should know that the iPhone is a GSM device, while Verizon’s 3G network is CDMA. Apple would have to build a different iPhone for Verizon or Sprint. Since almost no one else in the world uses CDMA, why would Apple go that route? Even more to the point, as I understand it, the CDMA networks do not allow data access during calls—one must hang up to use the browser or send/receive email. The iPhone, OTOH, can access data while on a call. A friend who bought a Pre was quite surprised to find out that he had to hang up to access a Google map. He’s considering ditching the Pre, even with the contract termination fees.

AT&T’s coverage needs work, especially there 3G. And there home repeaters are NOT THE ANSWER! Verizon says Apple is doing it wrong, yet the iPhone has changed everything in the wireless phone world, how is that wrong?
I think its only because Apple chose AT&T and not Verizon at the beginning is the only reason.
Hopefully the exclusivity will eventually end and the iPhone can be available to more providers like Verizon in the future for a broader choice.

Since almost no one else in the world uses CDMA, why would Apple go that route?

RIM did it with their blackberries, and it seems to be cost-effective for them…

First things first Verizon’s Mr. Seidenberg needs to come down off his pedestal. Apple came with iPhone in hand to Verizon first and Verizon turned them down. My guess is that Apple didn’t want to cripple the iPhone like Verizon does to so many other phones they carry. Verizon doesn’t want to give up paid services that the iPhone offers. Second now that Verizon sees what a success the iPhone is their wanting it big time, because they think they have a better network. Well their wrong I left Verizon because of too many dropped calls, I never have any more dropped calls with AT&T. Each wireless service has its own devil in disguise.

Since Apple is “doing it wrong” and is still making bank, then perhaps the “right” way is not so good. Apple’s way is “wrong” for Verizon, but not for customers and not for Apple.

I’d have to disagree with this. I think exclusivity was the right choice at the time. But the Apple would like to sell their product on the best available network. One reason the iPhone has been so successful is because there isn’t any competition… nothing comes close to it, and many people left other carriers just to have it. But starting Nov. 6 there will be a competitor (the DROID) and many who would have switched to ATT for the iPhone will make due with this very similar phone and a MUCH better network. Why would Apple want to keep their iPhone limited to a network with such scrutiny. The iPhone is awesome but if you can’t use it have the time people will go to 2nd best… and now VZ is offering that with the DROID. the only way to beat that is join the better network!

gslusher said: Since almost no one else in the world uses CDMA, why would Apple go that route?
RIM did it with their blackberries, and it seems to be cost-effective for them…

LTE is coming…

The iPhone is awesome but if you can’t use it have the time people will go to 2nd best… and now VZ is offering that with the DROID. the only way to beat that is join the better network!

Even if that “better” network would result in a major crippling of the iPhone’s capability? Also, today, Verizon may be “better” simply because it hasn’t had to deal with the high data demands that the iPhone imposed on ATT. If the Droid becomes very popular, we can expect to see problems with Verizon, as well.

LTE is coming…

When? 2011? When Verizon actually has a fully-capable LTE network, then it might make sense for Apple to offer the iPhone to them. For now, ATT & Verizon are busily siphoning off Sprint’s customers.

Everyone who wants to buy a crippled CDMA iPhone that will be obsolete before your service contract expires, raise your hands!

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