The skeptical view on the Verizon iPhone
The Wall Street Journal kicked up quite a fuss this week with the report that Apple was preparing a CDMA-version of the iPhone for launch later this year, finally bringing Apple's popular phone to Verizon's network. After so many reports, many of which I have covered, the fuss kicked up by this article was remarkable. Chalk it up to the Journal's gravitas.
But this was also met with some skepticism in some corners of the blogosphere. Everyone has their reasons. I want to list a few of my own.
- CDMA is on the way out. Verizon is beginning its aggressive deployment of LTE, the next-generation network that in initial tests is producing up to 40 megabits of download speed. That's fiber optics speed.
- Steve Jobs does not like technologies he sees as falling out of favor. People thought Apple was crazy for omitting the floppy drive from the early iMacs, not to mention old dataports, but they were proven right. Apple was the first to abandon backlit LCD screens in favor of LED screens. Now everyone wants LED screens, on laptops, big screen TVs and smartphones. Apple is a member the Blu-ray Disc Association but never adopted it because Apple went straight to downloadable content. And of course, there's the whole to-do over Flash. So for Apple to embrace CDMA, a technology that Verizon plans to obsolete as soon as it can, would be entirely out of character.
- The Journal said Apple considered CMDA a "short-term" technology since Verizon plans to move to LTE but "later changed its mind as it realized Verizon's upgrade would take longer than expected, said people familiar with the situation." Really? Verizon's CTO has said publicly that Verizon's LTE plans are on track and it expects to cover 100 million Americans by the end of the year.
- It would mean a separate SKU. Apple does not like to do that. They make one product and sell it all over the world. That's why they are on AT&T. AT&T supports the GSM network, which is widely deployed all over the world. Verizon's CDMA network can only be found in the U.S. and Korea.
- AT&T, Verizon and T-Mobile are all going to LTE. This is what Apple would want, as Current Analysis analyst Avi Greengart pointed out. They could make one phone and run it on everyone's network, except Sprint, which is in the ClearWire camp.
- We still don't know when the AT&T/Apple exclusive deal winds down. It's widely assumed the deal was three years, but when the two firms first paired up, USA Today said it was a five-year deal. Maybe a dozen people know the truth and they are not talking.
- Presumably, Apple had a chance to go to Verizon with the iPad. It chose not to. This is a guess on my part, as I don't know the contract deals. I assume the deal is just for phones and there's nothing in the contract for future non-phone devices.
- The Journal claims that the Verizon phone would come in September. That would mean a separate launch. That is out of character for Apple. Look at their iPod and MacBook launches. They introduce all models at once and they ship within weeks of each other. The fourth-generation iPhone will likely be introduced in June and ship in July, like Apple has done for three years now, the same way new iPods come out every September. So would Apple wait two to three months introduce another device? That's completely unlike Apple.
It just doesn't add up. I expect an LTE phone, and perhaps sooner rather than later in light of all the fuss being kicked up over HTC's 4G phone for ClearWire. With Verizon starting this year and AT&T beginning its LTE rollout next year, the incentive for Apple is to support LTE, not CDMA.