Wednesday, January 12, 2011

iPhone and Verizon: Will that be a Happy Marriage?

The rumors were going in rounds, but nothing happened… until now. The iPhone is finally coming to Verizon. After talking up his new LTE network a bit, Verizon CEO Lowell McAdam confirmed a CDMA (non-LTE) version of the iPhone 4 will be introduced to Verizon Wireless network next month. Talks started way back in 2008, and the phone has been in testing for a year -- it sounds like they wanted to get this one right. Current Verizon customers will be able to pre-order on February 3rd for the standard $200 price for the 16GB model on a two year agreement, $300 for the 32GB version -- everyone else can order on February 10th (see it compared with AT&T's iPhone 4). Just to clarify and put any wild rumors to bed, the phone is Verizon 3G (EV-DO) only, no 4G data or GSM roaming. It's not a world phone or an AT&T + Verizon phone, it's just a Verizon phone.

Outside of Verizon connectivity, the phone is basically unchanged, although Verizon's CDMA network doesn't support simultaneous voice and data as with the GSM version. It does have the new antenna design we were hearing about last week, but that's just because CMDA requires a different configuration of antennas. Apple claims they didn't go LTE just yet because first-gen chipsets would force unwanted design decisions, and customers want a Verizon device now. That slight modification also equates to a slight bump in where the volume buttons and mute switch -- a new case might be required. Software-wise the big innovation is five user WiFi hotspot functionality, something that's standard on Android phones, while Apple has kept the iPhone only able to tether directly to one computer.

How that may change the competition of the wireless carriers? A lot! With the network available on the US market, Verizon will be able to attract all the iPhone fans from the main competitor AT&T and ultimately dominate the market. When the iPhone hits Verizon on February 3rd, we are likely to see the following consequences:
  • Apple and Android will breakaway as the two leading mobile operating systems, both separating even further from the pack over the next year. BlackBerry, Windows Phone, WebOS and others are in big, big trouble.
  • Apple and Google will begin a more rigorous arms race in terms of releasing new and innovative features. This is what I really love: both want to “win” and will push harder and harder to make the best product, and in the end, it’s the consumer that really wins.
  • Prices for smartphones in general will drop due to increased competition – consumers win again.
Personally, as long-term Verizon user and fateful Droid fan, I do not care much about the new gadget introduction. But I do care on the quality and reliability of the network connection. There is a serious danger that Verizon’s network may become just as congested and overloaded as AT&T’s became as soon as iPhone has been introduced to AT&T. Verizon assures that network is ready for all surprises. Is that true – we will see soon.

Sources and Additional Information:

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