Verizon Prepares for the iPhone
Verizon Wireless is buttressing its network in the event Apple drops AT&T as the exclusive carrier of its popular smartphone — There's no telling yet whether or when AT&T (T) might lose its position as the sole U.S. carrier of the Apple (AAPL) iPhone.
Context & Ripple Effects
The report landed with unusual same-day pushback: CNET's Between the Lines ran a counter-piece telling readers not to believe the headlines, and both the network-upgrade claim and any end to AT&T's exclusivity remain unconfirmed rumors rather than announced deals.
The backdrop still makes the speculation plausible. AT&T spent mid-December weathering Operation Chokehold — a grassroots attempt by thousands of iPhone users to swamp its network at noon PST on Friday, which failed — while Verizon carries its own baggage into the matchup: doubled early-termination fees and an erroneous $1.99 charge drew an FCC inquiry, and critics called the company's written response weak excuses.
First-order effects
- If Apple ever opens iPhone distribution beyond AT&T, Verizon's rumored network upgrades would let it absorb iPhone traffic on day one; until then AT&T keeps the sole-carrier position and the subsidy-and-churn economics attached to it.
- Verizon hedges either way: tipsters report imminent launches of the Palm Pre Plus, Motorola Devour, and LG VS750, filling its lineup with non-Apple smartphones whether or not the iPhone arrives.
Second-order effects
- A credibly ready second carrier raises the price Apple can demand at the next round of exclusivity negotiations — the arrangement is worth less to AT&T the moment a rival can demonstrate comparable capacity.
- Verizon's alternative device slate hits the market just as AT&T's network reputation takes its most public damage yet from the failed Chokehold attack, sharpening head-to-head comparison shopping among smartphone buyers.
Third-order effects
- If the pattern holds, flagship-phone distribution drifts from single-carrier exclusives toward multi-carrier availability, with each carrier's network capacity, device pipeline, and regulatory standing — not just its checkbook — deciding who lands the next marquee handset.
- Regulatory scrutiny of consumer practices like termination fees and billing errors becomes a competitive variable in its own right, sitting alongside network quality in the carrier rivalry.
The trend: U.S. smartphone distribution is shifting from exclusive single-carrier lockups toward multi-carrier availability, and network preparation has become how carriers quietly bid for the right to carry a flagship.