Verizon's Killian: Customers will pay a premium for LTE

Verizon Communications (NYSE:VZ) CFO John Killian said Verizon Wireless will continue to accelerate service revenue growth and smartphone penetration among its subscribers. He said around 20 percent of Verizon's subscribers have smartphones now, and he expects that figure to grow to at least 40 percent at some point in the future.

Killian declined to go into specifics about the company's LTE plans, but said Verizon believes it can charge subscribers a premium for the higher-speed service. "Customers will pay for quality and premium service and premium speed," he said. Verizon plans to commercially launch LTE in 25-30 markets in the fourth quarter, covering 100 million POPs, and has promised real-world speeds of 5-12 Mbps downlink and 2-5 Mbps uplink.

On the device front, Killian said the company plans to release tablets in the "not-too-distant future." He said LTE tablets and smartphones will have to wait until next year, with tablets coming early next year and smartphones by the middle of next year.

Verizon has made smartphones running on Google's Android platform the centerpiece of its device lineup, and Killian said that will continue. "You will continue to see an evolution of enhancements, a steady stream of new devices," he said. "I definitely think in terms of the Droid franchise we're going to continue to be unique."

Killian was asked about the elephant in the room: if and when Verizon will snag Apple's (NASDAQ:AAPL) iPhone--an issue that Killian brushed off nonchalantly. "All of our assumptions about our business is we're going to have devices that act and perform just like the iPhone does," he said, adding that they will perform similarly in the marketplace and have similar usage characteristics.

"If the iPhone became available to us under the right terms, we would be interested in that," he said, adding that the carrier's customers are interested in it. 

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