This Monday there were new reports of Apple and Verizon discussing bringing the iPhone to the wireless network. According to InformationWeek.com sources close to both Apple and Verizon have confirmed that the two companies are engaged in “high level” negotiations that could result in AT&T losing their exclusive contract with Apple.
If the reports prove correct, the iPhone could be available on the Verizon network next year, allowing Verizon’s estimated 80 million customers to purchase and use Apple iPhone without leaving the network. The deal would be a boon for Verizon, as the network has been losing subscribers to AT&T over the past few years.
It has been reported that AT&T secured a five-year exclusivity agreement to provide wireless service for the iPhone, though neither AT&T nor Apple have confirmed this figure. If true, however, AT&T’s exclusivity contract would expire sometime in 2010. This will allow Apple to “shop around” among other wireless carriers and potentially strike deals with several different networks to carry the ever popular iPhone.
There has been talk within the industry that AT&T has sought to expand their original agreement with Apple. This seems reasonable, as the iPhone has been a big moneymaker for the company. One industry analyst estimated that one quarter of all new AT&T subscribers over the past year have been iPhone customers.
But from Apple’s point of view, having access to Nextel, T-Mobile and Sprint customers is a chance to sell hundreds of millions of new iPhone’s over the next few years.
The negotiations with Verizon could also be focused on utilizing Verizon’s planned 4G mobile network, which is set to debut in 2010. The new, higher speed, mobile network would be a perfect fit for the web enabled iPhone, allowing download and upload speeds comparable to home broadband Internet.
Additionally, the 4G protocol is expected to become the global standard over the next two years and a deal with Verizon would place Apple in a prime position to take advantage of the new technology. After all, even an iPhone is only as good as the network is connected to.
Since neither of the companies involved is doling out details right now, it is left up to the media pundits and “insiders” to determine the nature of the talks between Apple and Verizon. For many within the industry though, could also be wishful thinking. Many disgruntled former AT&T subscribers are hoping that Verizon gets the contract for the iPhone. The company has made a name for themselves in customer service, something AT&T has struggled with for a long time.
