VZ’s results were pretty much inline with Street estimates but the company realized an increase in the churn rate of post-paid wireless subscribers (due in large part to the iPhone) and is growing its wireless customer base more slowly than AT&T.

When asked about the iPhone, VZ said the ball’s in Apple’s court. Whatever. 

DawnTreader - 26 October 2009 09:21 AM

VZ’s results were pretty much inline with Street estimates but the company realized an increase in the churn rate of post-paid wireless subscribers (due in large part to the iPhone) and is growing its wireless customer base more slowly than AT&T.

When asked about the iPhone, VZ said the ball’s in Apple’s court. Whatever. 

These are not the droids you are looking for.

Obi-Wan Kenobi (iTablet) you are my only hope.

Verizon will be just fine. The company that should really worry is RIM.

On an earnings conference call, CEO Ivan Seidenberg said there was ‘nothing different’ to talk about with regard to Apple when asked about the possibilities of having the iPhone next year. ‘The decision is in Apple’s court,’ Seidenberg said. ‘We would be interested if they wanted us as a partner.’

rattyuk - 26 October 2009 09:59 AM

On an earnings conference call, CEO Ivan Seidenberg said there was ‘nothing different’ to talk about with regard to Apple when asked about the possibilities of having the iPhone next year. ‘The decision is in Apple’s court,’ Seidenberg said. ‘We would be interested if they wanted us as a partner.’

In other words, VZ is begging and Apple to told them to fly a kite, hence the anti iPhone adds.

I think we will see an iTablet with the option of having cell services through VZ.  I still don’t understand how one can have an VZ phone and iTablet on the same plan, yet the iTablet could not be used to make phone calls.

Unless the iTablet will be like every other lap top with a port for a ATT or VZ over the air internet card.  We will have to wait and see.

Their earnings call transcript is here!

Tim Horan – Oppenheimer & Co.

Ivan, while we have you, maybe a couple of strategic questions. Can you maybe talk about where we think the initiatives going with wireline/wireless integration? Is it more important to enterprise versus consumer?

And I guess related to that, the second part of that is how important is having this capability on a global basis? It seems like you were emphasizing it a little bit more in the press release.

And then third, maybe you can’t comment on it too much, but on the iPhone, could you talk about if you would like to get the iPhone or not and maybe why Apple wouldn’t build a cd-made version of the iPhone for the U.S.

Now in terms of the iPhone, there’s nothing really different about this. I think Lowell would remind us all that this is a decision that’s exclusively in Apple’s court. 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.

I have no further thoughts about why they may have done whatever they did. What they’ve done has been successful so we have to sit back and give them credit for that. But in the future, what we’ve done is what John said earlier, we’ve expanded our BlackBerry base, we’ve expanded our base of other devices. We now have the Droid coming out. We have an updated Storm coming out. We have application stores coming out. So I think 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.

The statement that “the ball is in Apple’s court” may be misleading. Verizon may have told Apple that they would gladly take the iPhone, but only on their own terms. In other words, no App Store (Verizon’s store instead), no YouTube (Verizon’s V-Cast instead), no ring-tone creation (buy from Verizon instead), no transfer of music bought through Verizon back to the computer, etc, etc, etc.

There are many reasons why Verizon does not have the iPhone. Probably the most important one is the obsession with complete control over the device. Verizon’s strategic goal is to commoditise handset devices and to instead build the brand awareness around Verizon. There will be no music downloads but Verizon; no App Stores but Verizon; no phone maker logos but Verizon’s.

AT&T agreed to become a dumb pipe for Apple. They are reaping benefits from that (as well as suffering consequences of such immense load on their network). Verizon will never agree to be a dumb pipe. And consequently, they will never get the iPhone.

I don’t think this story goes any further.

vasic - 27 October 2009 10:30 AM

I don’t think this story goes any further.

Save to see how “open” the Droid is. As far as I can see they are letting it access the android store and not a Verizon run store so we shall see what happens. If this is true then it looks like Verizon are bending to the openness they refused to accept when originally offered the iPhone. But after the Droid campaign I don’t think Apple will come knocking. I think the ball is back in Verizon’s court to come begging.

I for one would welcome a VZ (note: much less expensive) iPhone plan. I love my iPhone, but would LOVE to be done with AT&T! So would most iPhone users I’ve talked to.
Verizon should do WHATEVER they have to, to get the iPhone. Period.

vasic - 27 October 2009 10:30 AM

The statement that “the ball is in Apple’s court” may be misleading. Verizon may have told Apple that they would gladly take the iPhone, but only on their own terms… AT&T agreed to become a dumb pipe for Apple… Verizon will never agree to be a dumb pipe. And consequently, they will never get the iPhone.

I don’t think this story goes any further.

Unless…

If only Sprint (with its 3rd-rate CDMA network) would do a deal with Apple soon, before it gets gobbled up by Verizon (with its huge/1st-rate CDMA network).

Then a Cingular-to-ATT-type mergered/grandfathered iPhone deal would “deja-vu all over again” the iPhone into Verizon through the back door, without allowing Verizon the chance to work out/reject any deal of its own with Apple, prior to Verizon inheriting its own iPhone from Sprint.  (And Sprint getting the iPhone might actually catalyze Sprint getting gobbled up by Verizon, if its iPhone made Sprint’s subscriptions skyrocket, as they well might do.)

Competitive forces

The price of poker keeps going up.

Two other potential factors:

1. Apple would have to engineer a CDMA phone that would essentially be US-only. That would cost some R&D money and might require maintaining two versions of the OS. (Apple already has to do this for older iPods.)

2. The CDMA network would, itself, cripple the iPhone, as it does not support data and voice at the same time. One of the selling points of the iPhone has been the ability to check something on a web site and send/receive email while on a call. Pre owners can’t do that. (The one Pre owner I know is ready to ditch the Pre for an iPhone for this reason. Sprint was careful to NOT tell him this when he bought the Pre. He wants to be able to access his company’s web site and database while on the phone with a client.)

As for Verizon crippling phones, we’ll have to see what they do with the Droid. Even my cheap little Samsung was crippled by Verizon. According to Samsung, it can get ringtones from a PC, but not on Verizon. I had to buy ringtones from them, at $2.99-3.99 with terrible quality.

gslusher - 28 October 2009 02:27 PM

Two other potential factors:

1. Apple would have to engineer a CDMA phone that would essentially be US-only. That would cost some R&D money and might require maintaining two versions of the OS. (Apple already has to do this for older iPods.)

2. The CDMA network would, itself, cripple the iPhone, as it does not support data and voice at the same time. One of the selling points of the iPhone has been the ability to check something on a web site and send/receive email while on a call.

#1 is the main factor, Apple has stressed that on several occasions. It sees no reason to engineer a phone for a dying technology that will be going away in a couple years. It would probably take Apple some time to come up with a device and have it approved etc. So, then the question is “why not just wait for LTE?” Or Verizon, if you want it so bad, then hey, chip in and foot some of the bill. Or, hurry your ass up and get that LTE up and running.

It also depends when the AT&T exclusivity expires, which is supposed to be next year, but middle, end? I think the T-Mobile will be the next to get the iPhone.

#2- Does this mean if you are browsing the web you can’t receive a call at the same time? Like the 2G iPhone? As much as iPhone users are browsing, anybody can forget about getting a call through to them.

Apple predicted to sacrifice ‘sweetheart’ AT&T deal for Verizon

If Apple ends its exclusive carrier agreement with AT&T next year, it will likely mark the end of its estimated $450 carrier subsidy for the iPhone, a new analysis has forecast.

willrob - 28 October 2009 04:32 PM

Apple predicted to sacrifice ‘sweetheart’ AT&T deal for Verizon

If Apple ends its exclusive carrier agreement with AT&T next year, it will likely mark the end of its estimated $450 carrier subsidy for the iPhone, a new analysis has forecast.

I don’t think that analyst has his facts straight. First, the subsidy isn’t $450, It’s no more that $400. If Apple sells the unit, it is, but when BBY sells an iPhone, that pay Apple $542 (16GB), sell it for $199, and then AT&T reimburses them $400. However, that is beside the point…

Apple management said on the call that its pricing doesn’t change when exclusivity ends.
Gene Munster – Piper Jaffray
So when you go from exclusive to multiple carriers, you wouldn’t necessarily see change in pricing that you are charging the carrier? Is that correct?
Timothy D. Cook
That’s correct.

If Verizon wants to only subsidize it by $300, all the power to them, just means VZ will be offering iPhone for $100 more than AT&T.

turleymuller - 28 October 2009 04:43 PM

willrob - 28 October 2009 04:32 PM

Apple predicted to sacrifice ‘sweetheart’ AT&T deal for Verizon

If Apple ends its exclusive carrier agreement with AT&T next year, it will likely mark the end of its estimated $450 carrier subsidy for the iPhone, a new analysis has forecast.

I don’t think that analyst has his facts straight. First, the subsidy isn’t $450, It’s no more that $400. If Apple sells the unit, it is, but when BBY sells an iPhone, that pay Apple $542 (16GB), sell it for $199, and then AT&T reimburses them $400. However, that is beside the point…

Apple management said on the call that its pricing doesn’t change when exclusivity ends.
Gene Munster – Piper Jaffray
So when you go from exclusive to multiple carriers, you wouldn’t necessarily see change in pricing that you are charging the carrier? Is that correct?
Timothy D. Cook
That’s correct.

If Verizon wants to only subsidize it by $300, all the power to them, just means VZ will be offering iPhone for $100 more than AT&T.

I don’t really see Apple switching to Verizon.

I fully understand that there are a huge number of Verizon customers who wish they could get an iPhone without having to switch to AT&T.  I sympathize.  But all the wishing in the world is not going to make it happen.  What all the wishing does do is to fuel rumors.

But let us stop and think.  1) Would Verizon be openly mocking the iPhone in a major ad campaign if there were any chance of getting it?  2) What would have to happen for SJ to enter into a partnership with a company that has openly mocked his pride and joy?

We also need to repeat the question posed earlier by DT.  What would Verizon’s vaunted network performance be like it it had to handle the amount of data that has been thrown at AT&T?