Apple Joins AT&T/Verizon Food Fight
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After sitting on the sidelines for a few weeks, Apple (NASDAQ: AAPL) jumped into the war of words between AT&T and Verizon Wireless over 3G coverage with a pair of television commercials sticking up for its exclusive U.S. mobile partner.
Apple unleashed the hounds on Verizon on Monday with two ads that show an iPhone user talking to a friend on the iPhone's speakerphone while surfing the phone's browser for information about movies and restaurants or accessing e-mail. A voiceover asks, "Can your phone and your network do that?"
The ads come after a few weeks of sniping between Verizon, the nation's largest carrier, and AT&T (NYSE: T), the second-largest. Verizon finally capitalized on the recurring complaints by iPhone users over the quality of AT&T's 3G network with ads claiming to offer five times the coverage of the AT&T network.
At first the ads stuck to 3G networks and didn't go into hardware. Perhaps Apple was motivated to strike back after its iPhone was featured in an ad involving the Island of Misfit Toys from the Christmas special "Rudolph the Red-Nosed Reindeer."
Or maybe Apple was fired up from the Motorola (NYSE: MOT) commercials for its well-received Droid phone that made numerous uses of "iDon't" phrases, evoking Apple's use of the lower case "i" in product names and quirky commercial music. The commercial concluded, "Everything iDon't ... Droid does."
Calls to Apple for comment were not returned.
AT&T responded to Verizon a few weeks ago with an ad that that features actor Luke Wilson in voiceover claiming that AT&T's service has several advantages over Verizon's, including the ability to perform multiple tasks at once. "Which network lets you talk and surf at the same time?" Wilson asks before an "X" appears in a checkbox next to "AT&T."
Wilson also appears in an AT&T spot to "set the record straight" about the coverage issues, standing on a map of the country that demonstrates near-ubiquitous network coverage and rattling off names of cities where AT&T offers service.
This is the latest move in a running spat between the two wireless giants. Verizon fired the first shot with ads that copied the iPhone jingle and the phrase "there's a map for that" in reference to its allegations of anemic 3G coverage by AT&T.
AT&T filed a lawsuit demanding the ads be halted, claiming that Verizon's ads suggest that customers not connected to AT&T's 3G network will not be able to use their phones at all. Verizon's response was "the truth hurts." The judge's response to AT&T was essentially get over it.
AT&T is Apple's exclusive iPhone partner in the U.S. market through next year. Despite a lot of wishful thinking masquerading as analysis from market analysts, there have been no hints of Apple moving to Verizon, despite even Apple expressing dissatisfaction with AT&T's network. But the view for now is that Apple will stick with AT&T.