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Verizon Promises No Hiccups in iPhone Launch
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January 25, 2011

Verizon Promises No Hiccups in iPhone Launch

By Susan J. Campbell, TMCnet Contributing Editor


With the years of waiting for the iPhone to finally land on the Verizon (News - Alert) Wireless network, it really would be a shame if the launch were a mess. According to an Associated Press report, the nation’s leading wireless carrier won’t let that happen.


This is a bold statement, considering the problems AT&T has had with some of its iPhone (News - Alert) launches to date. A server meltdown accompanied the launch of the iPhone 3G in 2008, and the overwhelming consumer response to the iPhone 4 last summer left a website and system unable to keep up with demand.

Verizon does have the benefit of learning from AT&T’s (News - Alert) mistakes since the carrier first launched the iPhone in 2007. Verizon has been adding capacity to its network with its eyes on the iPhone launch.

"We're not going to have any flaws on the execution of the iPhone launch," Chief Financial Officer Fran Shammo told Wall Street analysts on Tuesday. Is this the right statement to make when the carrier still isn’t sure how many iPhones it will actually sell?

Shammo is not sharing any estimates, although the average analyst forecast is for 11 million units this year. This estimate is roughly the same amount AT&T sold in the first nine months of last year. Overall, analyst projections vary from five million to 13 million.

Lowell McAdam (News - Alert), Verizon’s chief operating officer, has confirmed that the company’s standard $30 per month unlimited data plan will be available for the iPhone. This could draw AT&T followers simply because the carrier did away with its unlimited data plans last summer in hopes of curbing network overload.

McAdam believes this is a competitive advantage for Verizon right now, but will only work for a short amount of time. Verizon plans to switch to “limited” data plans soon, but don’t hope for the $15 per month variety as the carrier plans to phase it out at the end of the month.

Analysts assume that Verizon will take a hit to its earnings this year as it plans to subsidize each new iPhone by roughly $400 to bring the purchase price down to $200 to $300. Of course, the carrier may not be worried as it announced earlier today that it attracted more than half a million smartphone subscribers in the last quarter, and the iPhone doesn’t go on sale until next month.

The carrier did start selling the iPad tablet computer in October, bundling it with an Internet access device that comes with a two-year contract. Verizon also offers the Samsung (News - Alert) Galaxy Tab and between the two, has moved 86,000 tablets – all with contract data plans.


Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan’s articles, please visit her columnist page.

Edited by Tammy Wolf


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