WSJ: Verizon to pair iPhone with unlimited data plan
Verizon Wireless (NYSE:VZ) plans to sell a CDMA-capable iPhone from Apple (NASDAQ:AAPL) with unlimited data service, according to a report in the Wall Street Journal, helping Verizon distinguish the smartphone from AT&T Mobility (NYSE:T), which stands to lose its exclusive grip on the device.
The report, which cited an unnamed source familiar with Verizon's plans, said the carrier will begin selling the iPhone around the end of the month. The Journal, along with other media outlets including Bloomberg and Reuters, reported that Verizon will unveil the iPhone at a media event in New York City Tuesday. Verizon sent out invitations to event, which starts at 11 a.m. EST and will be headlined by Lowell McAdam, president and chief operating officer of Verizon Communications and the former head of Verizon Wireless. The invitation asks recipients to "join us as we share the latest news," but provided no details. FierceWireless will be onsite Tuesday covering the event.
AT&T has been the exclusive provider for the iPhone since 2007 and last year introduced tiered, usage-based data plans. Verizon has long offer an unlimited data plan for smartphones at $30 per month, but late last year added an option of 150 MB per month for $15.
Verizon has been insisting for months that its network is capable of handling increased traffic from an iPhone. The company's network has been tested by an influx of millions of subscribers using devices that run on Google's (NASDAQ:GOOG) Android platform. AT&T has admitted it was unprepared for the deluge of traffic the iPhone caused, but has since spent billions upgrading its network to support faster data speeds and increased traffic.
While the announcement by Verizon is not yet official, analysts are already trying to predict how the competitive landscape will be altered if Verizon does launch the iPhone. Sales estimates by many analysts vary, but a consensus has emerged that Verizon might sell 9 million to 12 million iPhones in 2011. Others, however, are more cautious.
"PRTM believes that analyst predictions of as many as 13 million Verizon iPhone sales in 2011 are unlikely to be fulfilled," PRTM analyst Dan Hays said. "More likely, we will see 2011 Verizon iPhone sales in the range of 5-7 million, slowed by the high cost of subscribers breaking existing contracts, limitations of Verizon's CDMA technology for multi-tasking and global roaming, and an attractive portfolio of competing 3G and 4G devices in Verizon's arsenal."
The iPhone's arrival from Verizon could also help blunt the growth of Android and stall BlackBerry maker Research In Motion (NASDAQ:RIMM). According separate reports from research firms Canalys and the NPD Group, Android captured around 44 percent of the U.S. smartphone market in the third quarter, besting both Apple and RIM.
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