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Expecting to lose a significant portion of its market share on the soon coming official announcement by Verizon and Apple that the iPhone will be sold by Verizon, Apple has decided to make the customers decision to stay with AT&T a bit easier by giving away iPhones.
A source close to AT&T says "It's a must have strategy. For years we have been the exclusive retailer of the iPhone which without coincidence is our best seller. Our monopoly on the iPhone will soon be over, so we feel the time is right to give current and future AT&T customer a nice incentive to continue with or start using our services."
So far, this gamble is paying off for AT&T. By giving away iPhones with multi-year contracts will be able to weather the storm of a possible mass exodus of subscribers.
To be noted, the Original iPhone (AT&T version) is a GSM phone and Verizon's iPhone will be CDMA. These iPhones will not operate on the competitors carrier network due to this technical difference.
AT&T has partnered with Bobbing For Apples for their iPhone Giveaway promotion. Read more about it here: Apple iPhone 4 Giveaway.
Verizon iPhone
Verizon Wireless and Apple have teamed up to rescue the thousands of frustrated AT&T iPhone users that have had to deal with shoddy reception, dropped calls, and unreliable service. Finally these customers will be able to choose which carrier to use with their iPhone.
According to the report a person familiar with the matter has said that while Apple believes its exclusive relationship with AT&T has been successful, it believes that by opening the iPhone to a second carrier the company will be able to grow sales faster in the U.S.
This will mark the first time U.S. cellular consumers have been able to choose the network that carries their iPhone. While pricing for the Verizon phone is still unknown, it’s clear that with two vendors selling the phone, competition will be fierce. AT&T will likely be handling a surge in cancellations while Verizon needs to assure customers that their network can handle the load which crippled AT&T.
Analysts predict that AT&T will lose between one and three million new subscribers because of the Verizon deal. Toni Sacconaghi, an analyst at Sanford Bernstein, has been quoted by the Wall Street Journal estimating that Verizon may add up to 10 million iPhone customers. This would be a significant boost to the company’s 93 million users.
The Verizon iPhone will operate on Verizon's CDMA technology and will not be compatible with the GSM version of the iPhone that AT&T currently sells. Current AT&T iPhone users will not be able to use their AT&T iPhones on Verizon but we are confident that there will be special promotional pricing as an incentive to switch networks and purchase the Verizon iPhone.
