As Verizon profit falls, president praises iPhone innovation

[AppleInsider]

Verizon Communications announced lower quarterly profits Monday, while the company's successful cell phone business was noticeably impacted by the launch of the iPhone 3GS in June.

But Denny Strigl, Verizon's president, said that the mere presence of the iPhone in the market has had a ripple effect on competing devices, which, in turn, has been a benefit for Verizon Wireless.

Verizon has many smartphones that compete with the iPhone. The company intends to launch another iPhone competitor in the Palm Pre, after Palm's exclusive agreement ends with Sprint next year. The largest cell phone carrier in the U.S. also has a new BlackBerry Storm and Google Android phones on the way.

But all of those products are driven by the innovation brought by Apple and the iPhone, Strigl said.

"When you think about what Apple has done in bringing the iPhone into the marketplace," he said during the Q2 2009 conference call, "it truly has accelerated innovation. And as we talk to all of our manufacturers, everybody has come out with their own iconic device, and I think that this has been very good overall for our customers."

Verizon also expects to launch its own application store this year, to compete with Apple's App Store. Company officials have said they will require their store to be installed on new smartphones sold through the company.

Most of Verizon's second-quarter troubles came from its sagging landline business. Total profit was $3.16 billion, down from $3.4 billion a year ago.

Verizon recently bowed to the U.S. government and agreed that it would unlock some exclusive phones for use on smaller wireless carriers. This as members of the U.S. Congress are looking into exclusive cell phone arrangements such as the one between AT&T and Apple for the iPhone.

Last week, Verizon said it added 1.1 million wireless subscribers during the quarter. That lagged behind competitor AT&T, which netted 1.4 million new subscribers -- most of them choosing the iPhone.

Rumors have surfaced that Verizon is secretly prepping its high-speed Long Term Evolution 4G data network for launch in early 2010. This as AT&T chief executive Randall Stephenson is reportedly working behind the scenes to extend his company's exclusive iPhone contract with Apple.

[JavaCowboy]

Remember back in 2005 when the CEO of Intel complemented Apple on their Macs and advised new computer buyer to choose Macs just weeks before the announcement that Apple was moving from PowerPC to Intel?

Perhaps this is yet another such indication. It wouldn't surprise me if Apple makes some kind of deal with Verizon after the AT&T deal expires and LTE is up and running. Granted, Apple would need to get some kind of exception to Verizon's "use our app store by default" policy.

[anantksundaram]

Ah, it's amazing and gratifying to see how their tune has changed a couple of years later - all these big boys (both the carriers and the handset makers) were, by-and-large, smirking at the iPhone in January 2007.

SJ wholeheartedly deserves his last laugh on this.

[vercordio]

All commentary about technology aside (realistic LTE rollout speed, multiple iPhone architecture setups, etc), I simply can't understand how Apple would want to extend their contract with AT&T. Obviously, opening the doors would extend their financial opportunities - that's not even worth debating. But after WWDC, when several of the important new features of the 3GS had to be announced as not available at launch for the country in which the parent company is located... Just on embarrassment alone, that's a relationship-ender.

I can't imagine AT&T could offer enough money to offset those two points.

But maybe I'm just a wishful sot, longing for a Verizon iPhone...

[Cubert]

Um, hello! Verizon! It's not a good sign that your manufacturers needed to see the iPhone in order to "innovate". Copy is a better word.

[steviet02]

Originally Posted by vercordio

All commentary about technology aside (realistic LTE rollout speed, multiple iPhone architecture setups, etc), I simply can't understand how Apple would want to extend their contract with AT&T. Obviously, opening the doors would extend their financial opportunities - that's not even worth debating. But after WWDC, when several of the important new features of the 3GS had to be announced as not available at launch for the country in which the parent company is located... Just on embarrassment alone, that's a relationship-ender.

I can't imagine AT&T could offer enough money to offset those two points.

But maybe I'm just a wishful sot, longing for a Verizon iPhone...

Verizon pulls a lot of crap too. Disabling features of phones like bluetooth etc, very well documented.

[Rot'nApple]

SMMMOOOOOOOOOOOOOOOOOCCCCHHHHH

That's Verizon's president kissing up to Apple's A**!

[Quadra 610]

Rule of thumb:

Always bet on Apple.

[teckstud]

A new switcher from Verizon to the iPhone that the article speaks of-that would be me.

My new iPhone has kept me busy these days with pure enjoyment- no time for AI.
Just a quick hello!

[mdriftmeyer]

Originally Posted by vercordio

All commentary about technology aside (realistic LTE rollout speed, multiple iPhone architecture setups, etc), I simply can't understand how Apple would want to extend their contract with AT&T. Obviously, opening the doors would extend their financial opportunities - that's not even worth debating. But after WWDC, when several of the important new features of the 3GS had to be announced as not available at launch for the country in which the parent company is located... Just on embarrassment alone, that's a relationship-ender.

I can't imagine AT&T could offer enough money to offset those two points.

But maybe I'm just a wishful sot, longing for a Verizon iPhone...

You know nothing about the contracts the two parties signed for that 5 year period. You also know nothing of Verizon's past practices and current practices towards phone providers.

[paxman]

Originally Posted by steviet02

Verizon pulls a lot of crap too. Disabling features of phones like bluetooth etc, very well documented.

How can Verizon possibly carry the iPhone if they are going to insist on having their own app store? That would seem to be an instant deal breaker for Apple.

[christopher126]

Originally Posted by Quadra 610

Rule of thumb:

Always bet on Apple.

Well said! Yep, Don't be a putz like the music industry, the television industry (HBO, NBC), the movie industry, (Disney, etc), the cell phone industry, (Verizon-2 years ago, Motorola-ROKR), IBM (PowerPC chip maker), Microsoft (Zune, Live, Mobile windows, Vista, etc.), CompUSA, Walmart, HP, Dell, Sony (Desktops & laptops), Scandisk (MP3 players), & China! The list goes on and on! Apple is "schooling" these twits!

Watch out Kindle, Camera manufacturers, Hand-held game manufactures and GPS manufacturers!

[Roc Ingersol]

Originally Posted by JavaCowboy

Perhaps this is yet another such indication.

Yeah, it's been kinda hard to miss the story-between-the-lines this summer.

AAPL on ATT: ...
ATT on AAPL: we won't always have the iPhone.
VZW on AAPL: Apple is innovative and successful.

[Logisticaldron]

Originally Posted by JavaCowboy

Compliments given before deal announcement?

That, another product, of they are still in talks and trying to sway Apple into a deal by doing some brownnosed grandstanding in their favour. I see no other business reason.

Originally Posted by teckstud

My new iPhone has kept me busy these days with pure enjoyment

Now you know what iPhone owners have been experiencing for 2 years. Even more so back in 2007 when comparatively there was less competition to the UI and web browser.

Originally Posted by paxman

How can Verizon possibly carry the iPhone if they are going to insist on having their own app store? That would seem to be an instant deal breaker for Apple.

It’s Verizon’s rules, if they have to make an allowance for the iPhone then they’d probably do it.

[Napoleon_PhoneApart]

What?! He didn't praise the Palm Pre for its innovation?! Awwww....

[dagamer34]

Originally Posted by mdriftmeyer

You know nothing about the contracts the two parties signed for that 5 year period. You also know nothing of Verizon's past practices and current practices towards phone providers.

There must be at least two separate agreements between Apple and AT&T as revenue sharing definitely isn't in their latest agreement. It may be that there initial agreement for 5 years but as of now it is only two years from 2008-2010.

[k2director]

Verizon will have its own App Store, and require it to be included on every phone it sells?

Are they kidding? So if I buy an Android phone, it will come installed with two stores selling Android software--the Android one and the Verizon one? If I buy a PalmPre, it will come with a Verizon store selling Pre software, and then the official Palm app as well?

Does Verizon actually think this is good for the customer experience? Could Verizon be any more grasping and stupid than this?

Stay out of the software business, Verizon. Just because one of the best software companies on the planet (Apple) has found success with an App Store doesn't mean you can/should jump on the bandwagon too. You don't know what you're doing. You have zero credibility with developers. You have zero credibility creating easy-to-use software. Stick to what you do well, and leave running an App Store to the companies that develop the phone platforms.

[dasein]

Originally Posted by AppleInsider

Rumors have surfaced that Verizon is secretly prepping its high-speed Long Term Evolution 4G data network for launch in early 2010.

Aren't LTE and 4G two completely different animals?

[razorpit]

Originally Posted by k2director

Verizon will have its own App Store, and require it to be included on every phone it sells?

Are they kidding? So if I buy an Android phone, it will come installed with two stores selling Android software--the Android one and the Verizon one? If I buy a PalmPre, it will come with a Verizon store selling Pre software, and then the official Palm app as well?

Does Verizon actually think this is good for the customer experience? Could Verizon be any more grasping and stupid than this?

Don't worry, there is no way on this green earth SJ is going to let Verizon get anywhere near the app store. If anything, you may see, "Apple's App Store brought to you by the good people at Verizon" or something like that. I believe Verizon's app store will be for the "dumber" smart phones and the ones which don't have applications on them today. Now that the industry has seen how successful apps can be, everyone is going to get in to the act over the next year or two and allow applications to be run on their phone. Apple right now has the upper hand, just like they did in 1984. Let's hope they don't become complacent like they did back then, and let the rest of the industry catch up.

[mcloki]

The two store thing isn't that big of a deal. I don't don't buy any other product from one monolithic corporation.

This is just Verizon putting on a friendly face. They've seen what the iPhone exclusive has done for ATT. They want a piece of the 10" iTouch market.
How many At&T customers will switch to Verizon if they had the iPhone and iTablet.
My guess is a lot. And that translates into dollars.

[Dreadkid08]

Verizon's app store is going to fail. Because you figure, they are going to have at least 4 platforms on their network: WebOS, Windows Mobile, The Blackberry OS, and Android. These are all different operating systems. If I'm a developer, why would I want to develop for Verizon for all 4 of these platforms when I can develop for 1 platform, the iPhone OS, which is the most successful one. So I could probably make the most money developing for that than Verizon in which I'd likely be wasting money trying to develop for 4 different platforms

[Hoss]

The iphone is so good that it even works on AT&T. Looks like we're gonna have a carrier war next year.

[Wiggin]

Originally Posted by Cubert

Um, hello! Verizon! It's not a good sign that your manufacturers needed to see the iPhone in order to "innovate". Copy is a better word.

I think it's part that the manufacturer needed the iPhone to copy, but also part that the carriers needed to see the iPhone's success in order for them to let the manufacturers innovate. Who knows what stuff the phone manufacturers could have come up with on their own if their every design wasn't dictated and/or crippled by the carriers.

Originally Posted by k2director

Are they kidding? So if I buy an Android phone, it will come installed with two stores selling Android software--the Android one and the Verizon one? If I buy a PalmPre, it will come with a Verizon store selling Pre software, and then the official Palm app as well?

No, according to Verizon's app store announcement, your phone will only come with one app store, namely Verizon's. If you want the Android or Palm app stores, you'll need to install them yourself.

Hmm, so does that mean I'd need to purchase the Palm app store application from the Verizon app store?

[Dick Applebaum]

Originally Posted by vercordio

All commentary about technology aside (realistic LTE rollout speed, multiple iPhone architecture setups, etc), I simply can't understand how Apple would want to extend their contract with AT&T. Obviously, opening the doors would extend their financial opportunities - that's not even worth debating. But after WWDC, when several of the important new features of the 3GS had to be announced as not available at launch for the country in which the parent company is located... Just on embarrassment alone, that's a relationship-ender.

I can't imagine AT&T could offer enough money to offset those two points.

But maybe I'm just a wishful sot, longing for a Verizon iPhone...

I assume that the ATT exclusivity only pertains to the iPhone product category (a cell phone first).

Now, if Apple were to introduce another category, say a mobile device (laptop, netbook, game player, or tablet) that was not, primarily a phone, but used the cell network(s) in addition to other connectivity...

So, this new [category of] device, can be used as a phone, but that's not its primary use-- mobile access to content is the driving use (of the networks).

Apple could honor and expand their current iPhone agreements (ATT exclusive, in the US) while offering the new category to ATT & others, alike!

It need not be locked to a specific (or single) carrier, and could be paygo. Alternately, a contract with a minimum monthly subscription say $5 per carrier for 2 years, with several carriers. Then this smart device, wherever it happens to be, would "look around" for the "best deal" of the moment (signal quality, data rate, cost per minute, minutes used this month thresholds, etc.).

If you tended to use a few carriers, you could sign a contract with these, for a larger monthly rate and get a reduced cost per minute.


As posted in other threads, I believe that this new category will be a "must-have" for all segments of the population, and will sell in the hundreds of millions per year.

Dick

[phalanx]

Originally Posted by christopher126

Well said! Yep, Don't be a putz like the music industry, the television industry (HBO, NBC), the movie industry, (Disney, etc), the cell phone industry, (Verizon-2 years ago, Motorola-ROKR), IBM (PowerPC chip maker), Microsoft (Zune, Live, Mobile windows, Vista, etc.), CompUSA, Walmart, HP, Dell, Sony (Desktops & laptops), Scandisk (MP3 players), & China! The list goes on and on! Apple is "schooling" these twits!

Watch out Kindle, Camera manufacturers, Hand-held game manufactures and GPS manufacturers!

Yeah, it is too bad that Apple can't take over every electronic device. Then we can have Apple dictating everything we do. We won't have to be confused about what we run on our devices, Apple will only allow what Apple wants you to have. They know best. Our lives as drones can be happy and bliss. Thanks Apple for controlling ever aspect of our Apple devices. Freedom to choose is overrated.

[TenoBell]

In the Apple quarterly call COO Tim Cook said that the company has an "excellent relationship" with AT&T and that Apple is very happy with it.

Originally Posted by Roc Ingersol

Yeah, it's been kinda hard to miss the story-between-the-lines this summer.

AAPL on ATT: ...
ATT on AAPL: we won't always have the iPhone.
VZW on AAPL: Apple is innovative and successful.

[al_bundy]

Originally Posted by paxman

How can Verizon possibly carry the iPhone if they are going to insist on having their own app store? That would seem to be an instant deal breaker for Apple.

i'm pretty sure you can get Blackberry AppWorld and it's 100 apps on a Verizon Blackberry

[al_bundy]

Originally Posted by vercordio

All commentary about technology aside (realistic LTE rollout speed, multiple iPhone architecture setups, etc), I simply can't understand how Apple would want to extend their contract with AT&T. Obviously, opening the doors would extend their financial opportunities - that's not even worth debating. But after WWDC, when several of the important new features of the 3GS had to be announced as not available at launch for the country in which the parent company is located... Just on embarrassment alone, that's a relationship-ender.

I can't imagine AT&T could offer enough money to offset those two points.

But maybe I'm just a wishful sot, longing for a Verizon iPhone...

Same thing on Verizon, except Blackberry will announce a new phone and you have to wait 3 months until you can buy it

[teckstud]

Originally Posted by Logisticaldron

Now you know what iPhone owners have been experiencing for 2 years. Even more so back in 2007 when comparatively there was less competition to the UI and web browser.
QUOTE]

Not so sure about that- everything I'm enjoying now, the iPhone didn't have back then- the video, the texting, the copy and pasting , even the compass- love all of that. Even the Apps weren't around then. But I hear what you saying- somewhat.

[backtomac]

Originally Posted by dasein

Aren't LTE and 4G two completely different animals?

No.

LTE and WiMax are 4g technology.

[ghostface147]

Originally Posted by Cubert

Um, hello! Verizon! It's not a good sign that your manufacturers needed to see the iPhone in order to "innovate". Copy is a better word.

And Apple doesn't copy things? Please.

[STecchino]

Originally Posted by Roc Ingersol

Yeah, it's been kinda hard to miss the story-between-the-lines this summer.

AAPL on ATT: ...
ATT on AAPL: we won't always have the iPhone.
VZW on AAPL: Apple is innovative and successful.

Well said!

[alansky]

Shamelessly copying an innovative new device like the iPhone (and copying it badly at that) is not "innovation". So far, we have seen very little genuine innovation coming from the iPhone's would-be competitors. This situation will hopefully change, but not until the handset makers realize how far behind they actually are.

[mdriftmeyer]

Originally Posted by dagamer34

There must be at least two separate agreements between Apple and AT&T as revenue sharing definitely isn't in their latest agreement. It may be that there initial agreement for 5 years but as of now it is only two years from 2008-2010.

They have made two separate agreements. Go back over the 10-Qs for the past 5 years.

[mdriftmeyer]

Regarding AT&T's network.

The AT&T deal has been so lucrative for Apple that they were willing to devote heavy resources on the iPhone project to give AT&T a platform to test all the capabilities and short coming of their 3G network technologies deployed.

Apple has been working with AT&T to help them improve it for the past 4 years.

[StupidGenius]

Originally Posted by Roc Ingersol

Yeah, it's been kinda hard to miss the story-between-the-lines this summer.

AAPL on ATT: ...
ATT on AAPL: we won't always have the iPhone.
VZW on AAPL: Apple is innovative and successful.

Agreed. Especially after the CEO makes a statement like this during their earnings call.

From Bloomberg.com: “There’s a very good possibility” Verizon will offer an LTE device with Apple, McAdam said. He declined to comment on whether the companies may collaborate before that.

[TenoBell]

The basis isn't true. Apple has said it's conference call that they are extremely happy with AT&T.

Originally Posted by StupidGenius

Agreed. Especially after the CEO makes a statement like this during their earnings call.

From Bloomberg.com: “There’s a very good possibility” Verizon will offer an LTE device with Apple, McAdam said. He declined to comment on whether the companies may collaborate before that.

[macxpress]

I don't see any reason for Apple to stop using AT&T. They seem to have a good relationship. At the same time...it would be great for Apple to expand their offerings and offer a Verizon iPhone. I think it would only benefit Apple and its customers and potential customers. There are customers that are perfectly happy with AT&T and making them switch to another carrier may not be the best thing to do. At the same time, there are people who don't like AT&T for one reason or another and would like to keep using the iPhone, but not with AT&T's service, or they would like to buy an iPhone, but are turned off by the fact that they have to use AT&T.

I know this puts possibly a little more strain on the iPhone engineering team, but I just think it would be nice for Apple to broaden its horizons a little and not keep everything to 1 device. Apple knows it has a hit on its hands now, unlike when it first introduced the iPhone. This could really make the iPhone bigger than it already is.

[quinney]

Originally Posted by TenoBell

In the Apple quarterly call COO Tim Cook said that the company has an "excellent relationship" with AT&T and that Apple is very happy with it.

If Apple is negotiating with Verizon, it would not have given Apple any leverage
to say that they were unhappy with AT&T. Cook's statement reminds me of the
statements often made by owners of sports teams, who praise the unsuccessful
coach just a few days before replacing him.

[Olternaut]

Originally Posted by paxman

How can Verizon possibly carry the iPhone if they are going to insist on having their own app store? That would seem to be an instant deal breaker for Apple.

SJ to verizon ceo: "A verizon app store?" *snickers* "Whatever, now shut up and listen! This is how the apple app store works and this is what you need to do to get your network to support it. And you had better not @#$@ this up!"