Verizon iPhone rumors abound, and the hope is that the gadget could be a reality in the next few months. But though the persistent rumor is that a CDMA iPhone from Apple Inc. (NASDAQ: AAPL) that will be compatible with the Verizon (NYSE: VZ) network by January of 2011 at the latest, that may be wishful thinking.
TechCrunch recently claimed that Apple Inc. had put in an order for millions of CDMA chips with supplier Qualcomm (NASDAQ: QCOM) in anticipation of Verizon iPhone production and the announcement that Verizon CEO Ivan Seidenberg would keynote the Consumer Electronics Show in January are both strong evidence in favor or the rumor. So is a recently filed form form AT&T (NYSE: T) advising shareholders to prepare for the loss of the company’s iPhone exclusivity. But if we know anything about Apple and its iPhone, it’s that the Cupertino, Calif., company loves to control launches and build the hype machine up. That means things may not be as obvious or as simple as they seem.
As Kaufman Bros. analyst Shaw Wu noted in a report this past Monday, it’s likely that both Verizon and Apple are hesitant to release an iPhone that isn’t a marked improvement both existing models — not to mention competing smartphones such as those powered by the Google Inc. (NASDAQ: GOOG) Anroid OS like the Droid phones from Motorola (NYSE: MOT) already supported by Verizon. That being the case, a CDMA iPhone from Verizon and Apple seems unlikely according to Wu. The two would more likely release a “SVDO” phone, a device that allows simultaneous voice and data usage. Even that, however, would be an interim before the next true generation of smartphone from Apple. Given the historic release schedule of new iPhone models in late spring or summer, a Verizon iPhone that represents the desired technology evolution wouldn’t appear until mid-2011 at the earliest. It may very well be in the interest of both parties to wait until then.
It’s more likely that the supply chain evidence pointing to the release of a CDMA iPhone doesn’t indicate a imminent partnership with Verizon, so much as it points to the rumored T-Mobile iPhone. A July report from Cult of Mac said that a T-Mobile iPhone was likely to come out in fall 2010, citing a “highly placed source” at T-Mobile USA. Wu also says it would be “premature” to rule out an offering with T-Mobile this year.
The world is hungry for the Verizon iPhone, and understandably so. Both Verizon and Apple Inc. shareholders have seen the statistics. Every day brings one more market analysis or survey results report from research firms like Morplace, whose most recent publication found that, of 1000 individuals polled, 51% of those that were current Verizon customers said they would purchase an iPhone and 47% would consider making the jump from AT&T. 29% of everyone polled, regardless of their current mobile phone provider or how many iPhones they already have, said they were very likely to buy a Verizon iPhone when it became available. That’s what’s on the line for Verizon and Apple and their long-rumored smartphone: A possible pull of thirty percent of the mobile phone market. Despite reports to the contrary, the Verizon iPhone is still far off.
As of this writing, Anthony Agnello did not own a position in any of the stocks named here.
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