Is Apple's iPhone deal with Cingular a handicap to both parties? You almost get that impression hearing to Verizon executives tell it.
On a conference call following Verizon's fourth quarter earnings, analysts were quick to ask Dennis F. Strigl, Verizon chief operating officer, about the iPhone. After all, a USA Today report detailed how Verizon turned Apple down due to Steve Jobs' terms.
The biggest item in the USA Today report was that the Apple and Cingular deal is exclusive for five years. For what it's worth--that's a long time for the iPhone to be tethered to a network that can be spotty at times. In Cingular's case, Apple most likely gets most of the ROI. Cingular is clearly hoping to grab subscribers.
Here's what Strigl had to say:
"If you all have seen the USA Today article that Leslie Cauley wrote, our take is that she was right on. The iPhone market, the iPhone product is something where, quite frankly, we’re happy that we’re not first to market with the iPhone. We think that innovation and a focus on music will benefit the whole industry. It really does draw attention to our data capabilities. You heard from Doreen that that’s a very strong market for us, but bottom line on the iPhone, I think we’re -- many are interested in comparing a future offering with what we have in the marketplace today: it’s like comparing apples and oranges. I will tell you that we will stay competitive and more on that as the year rolls out. Looking at the product line that we have, particularly the handset lineup, we’re very confident with our strategic partners and we’ve had a lot of good product from all three of our major suppliers, and there too, more on that as the year rolls out."
Reading between the lines there are some key takeaways to be had from those comments:
- iPhone was addressed only in one question so in the grand scheme of Verizon's business it's not all that important.
- Why isn't it important? Verizon mentioned business users repeatedly. It's unclear whether the iPhone can be a business tool.
- Verizon's big bang is really its FiOS network.
Apple gave rivals a big heads up by preannouncing the iPhone. Don't be surprised if Verizon's key partners come out with iPhone killers shortly.