iPhone sales in America could double as AT&T loses exclusive network agreement
- The Guardian,
- Article history
The US's biggest mobile network, Verizon, is expected to announce next week that it will begin selling Apple's iPhone.
The move, which requires different chips in the phone from those used in the version already sold through AT&T, America's second-biggest network, could potentially double iPhone sales in the US.
Leaked figures last month suggested that while Verizon grew its smartphone sales from 2.7m to 3.3m in the third quarter of 2010, AT&T's iPhone sales alone grew from 2.7m to 5.7m following the introduction of the iPhone 4 in the summer. That means that both Verizon and Apple stand to benefit handsomely from the move, which would end the exclusive agreement that AT&T has had since the iPhone's introduction in 2007.
Apple already has a 27% share of the US smartphone market, level with BlackBerry maker RIM and just ahead of Google's Android mobile operating system, according to the market research company Nielsen.
Verizon's forthcoming announcement, trailed to journalists yesterday with the cryptic message "Join us as we share the latest news", could slow the growth of Android phone sales – though the clearest loser would be RIM, which was eclipsed in the US by Apple in the third quarter.
AT&T could lose customers who defect from its network when buying their first smartphone – as 70% of US buyers have yet to do – or shift their iPhone contract.
However existing iPhone owners will not simply be able to switch networks. The iPhone for Verizon uses a different mobile communication standard, called CDMA, than that for AT&T, which uses the GSM standard used in Europe and by a number of Asian operators. The time required to design different chips, plus the legal implications of the exclusivity agreement with AT&T – which was thought to be for five years, not four – are believed to have held up the Verizon design.
This week at the Consumer Electronics Show in Las Vegas, Verizon's chief executive said the company plans to have 10 new devices – including four smartphones and new tablets – in stores by mid-year for its high speed wireless data service, known as LTE or 4G. However observers do not expect the Verizon iPhone to run either system.
An AT&T spokesperson told the Wall Street Journal: "There has been lots of incorrect speculation on CDMA iPhones for a long time. We haven't seen one yet and only Apple knows when that might occur."
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