Verizon CEO: No need for iPhone killer

Verizon will be able to compete against AT&T, the exclusive carrier of the iPhone, with its advanced 3G services, CEO says.
Written by Marguerite Reardon, Contributor
CHICAGO--With the Apple iPhone launch less than two weeks away, Verizon sees its services, and not a new iPhone-killing handset, as the way to compete against rival AT&T, said CEO Ivan Seidenberg.

Seidenberg, who took questions from reporters about the iPhone Wednesday during a press conference at the NXTcomm trade show here, said the company already has several new devices on the market and plans to continue adding to its lineup later in the year. But he also said Verizon plans to compete against AT&T, which is the exclusive carrier for the iPhone, by emphasizing the company's services.

"We just added four new devices in the past month," he said. "The new BlackBerry is flying off shelves. The way we see it, our customers have price points and service packaging that is different."

Specifically, he pointed to Verizon's V Cast music service that allows consumers to download songs over the air, and mobile video services including the new V Cast TV that uses the MediaFlo network built by Qualcomm to broadcast live TV.

When asked if he thinks the company will take a hit from subscribers ditching Verizon Wireless' service for AT&T's, he said he believes Verizon is in a very good position. Verizon Wireless has long enjoyed strong customer loyalty with one of the lowest churn rates of any major wireless operator in the country.

"The way we come at this is to let the iPhone hit the market," he said. "I don't think it changes the game plan for how we approach the market. But we need to see the impact. The burden is on (AT&T and Apple) to prove the market will change."

Seidenberg also added that he thinks the iPhone will actually help drive business for Verizon's high-end smart phones and advanced data services.

"The iPhone will add excitement and stimulation to the market," he said. "If we have done our job, then we will be a beneficiary. I hope it does reasonably well."

But a ban imposed earlier this month by the International Trade Commission on handsets that contain some 3G, or third-generation, Qualcomm technology could throw a monkey wrench into Seidenberg's plan, if the issue isn't resolved. On Wednesday, Qualcomm told Reuters that the ban could affect future versions of MediaFlo handsets.

"Broadcom's assertions were related to EV-DO and WCDMA chips and handsets. This ban is unrelated to MediaFlo technology, but will impact future models of MediaFlo handsets since they contain EV-DO or WCDMA technology," Reuters quoted a Qualcomm spokesman as saying.

Verizon Wireless and AT&T are using the MediaFlo technology for their mobile broadcast TV services. So far Verizon is the only one to have the service up and running. MediaFlo is currently available in 40 cities and will be in 120 cities by the end of the year, according to Seidenberg.

Fortunately for Verizon, it had already begun shipping MediaFlo handsets before June 7, the date the order was issued. So the worst-case scenario is that only future versions of these handsets would be affected and not handsets shipping today.

Qualcomm has filed for an emergency stay on the ITC ruling in federal court. And it's seeking a presidential veto.

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