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Old 03-30-2010, 10:01 AM
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Arrow New iPhone for fall 2010 breaks AT&T monopoly

For anyone who's wanted an iPhone but didn't want AT&T or was locked into a contract with another carrier, you may be able to get your iPhone and keep your carrier.
MARCH 30, 2010
New iPhone Could End AT&T's U.S. Monopoly

Apple Inc. plans to begin producing this year a new iPhone that could allow U.S. phone carriers other than AT&T Inc. to sell the iconic gadget, said people briefed by the company.

The new iPhone would work on a type of wireless network called CDMA, these people said. CDMA is used by Verizon Wireless, AT&T's main competitor, as well as Sprint Nextel Corp. and a handful of cellular operators in countries including South Korea and Japan. The vast majority of carriers world-wide, including AT&T, use another technology called GSM.

Apple is developing a new iPhone to debut this summer and also appears to be working on another model for U.S. mobile phone operator Verizon Wireless. WSJ's Julia Angwin and Simon Constable discuss.
With Apple developing a phone with CDMA capability, its exclusive U.S. arrangement with AT&T dating to 2007 appears set to end.

Verizon Wireless, owned by Verizon Communications Inc. and Vodafone Group PLC, declined to comment. An AT&T spokesman said: "There has been lots of incorrect speculation on CDMA iPhones for a long time. We haven't seen one yet and only Apple knows when that might occur." Apple declined to comment.

Separately, Apple plans to release a new version of its current iPhone this summer, continuing its practice of annual upgrades at about the same time of year, said people briefed on the matter. The model is likely to be thinner and have a faster processor, two people familiar with the device said.

For AT&T, the Apple relationship has been crucial, helping to make the carrier the U.S. leader in lucrative smart-phone market share. According to comScore Inc., AT&T has over 43% of all U.S. smart-phone customers, compared with 23% for Verizon. These customers are especially attractive because they generally pay higher monthly rates for data plans.

For several quarters, AT&T's growth has come almost single-handedly from the iPhone. In the fourth quarter of 2009, the carrier said it activated 3.1 million new iPhones. In comparison, it counted only a net total of 2.7 million new subscribers as some customers moved from other phones to iPhones.

"You're not going to lose the iPhone [exclusivity] and make up growth somewhere else without bearing the cost," said Sanford C. Bernstein & Co. research analyst Craig Moffett.

The people briefed on the matter said the upgraded GSM iPhone is being made by Taiwanese contract manufacturer Hon Hai Precision Industry Co., which produced Apple's previous iPhones. The CDMA iPhone model is being made by Pegatron Technology Corp., the contract manufacturing subsidiary of Taiwan's ASUSTeK Computer Inc., said these people.

One person familiar with the situation said Pegatron is scheduled to start mass producing CDMA iPhones in September. Other people said, however, that the schedule could change and the phone may not be available to consumers immediately after production begins.

Representatives of Pegatron and Hon Hai declined to comment.

People familiar with the situation said Apple originally decided against developing a phone for Verizon to keep its development process simple, since the technologies are incompatible.

Verizon also is upgrading its network to a higher-speed technology, so Apple has said it believed CDMA was a short-term technology. Apple later changed its mind as it realized Verizon's upgrade would take longer than expected, said people familiar with the situation.

Making the iPhone available through Verizon, which has over 91 million customers, as well as potentially other CDMA carriers could open up a significant new market. In 2009, iPhone sales globally rose 83% to 25.1 million, far outpacing the 20% to 25% growth in smart phones sales overall, according to Bernstein. But since Apple already dominates smart-phone sales through existing partners, "sooner rather than later, Apple is going to have to look to find incremental distribution," said Bernstein analyst Toni Sacconaghi. He estimates Verizon could help Apple nearly double the number of iPhone users in the U.S.

AT&T's relationship with Apple, a lucrative deal arranged by Apple Chief Executive Steve Jobs, shows how such a partnership with other carriers could present challenges.

Analysts estimate AT&T pays Apple more than $600 per phone, but sells most of them for $199 or less. Heavy iPhone users have also put an enormous load on AT&T's wireless network, pushing the carrier to a breaking point in some markets such as New York and San Francisco.

Qualcomm Inc., which holds patent rights to CDMA, is the dominant designer of CDMA chips.

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Old 03-30-2010, 10:30 AM
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Default Re: New iPhone for fall 2010 breaks AT&T monopoly

I'm relatively certain I posted on here about 6 months ago where a Verizon top level tech told me this was coming when I was pulling my hair out trying to get the POS Blackberry Storm to work. Being fed up with AT&T I opened an account with Verizon as well and carried my iPhone as well as the Blackberry Storm, what Verizon touted as their "best" smartphone.

I forced myself to use both for 3 full months before I made any decision. That decision was that the Storm was the worst damn phone I'd ever used! So, I gave it to my wife. I figured that since she'd never had a 'smartphone' that she may like it. Nope. Besides having what amounts to just a plain terrible OS, my wife found the other downside to CDMA, power consumption. She was used to going 2 or 3 days between charging her phone. With the Storm, she never could get through a single day.

I called Verizon over and over about the issues. They changed my phone 2 different times even though I didn't think there was anything wrong with the phone itself. (Hey, reminds me, anybody want to buy a new Storm? I need to put it on eBay now that I think about it) Obviously, that made no difference. That's when I got to higher level techs at Verizon who told me that CDMA simply uses more battery power and, with a large screen, the Storm would never have a good battery life. Concerning the confusing and annoying OS on the Storm, the Verizon tech told me that they'd already inked an agreement with Apple for the iPhone but he didn't know the time frame.

Having this knowledge brings just one question to mind; what will the battery life be with an iPhone on Verizon or Sprint? People have been using hacked iPhones on T-Mobile for years with no problems. There again, T-Mobile also uses GSM like most of the rest of the world. That sort of dampens my thought of having a great working iPhone through Verizon. Unless there are some unannounced major breakthroughs on batteries, battery life on a Verizon iPhone will likely suck. Talk about a buzz-kill.

One other thing I could tell was that the GSM 3G network through AT&T was considerably faster than the 3G CDMA Verizon network. Either that or the processor in the 2nd generation iPhone is 3X as fast as the processor in a Blackberry Storm. Downloads were much faster with AT&T than Verizon. Verizon loves to tout their map as if you won't have coverage in most areas with AT&T, which isn't true. AT&T goes to "Edge" rather than 3G. To be honest, AT&T's Edge is about equal to Verizon's 3G when comparing the two when I set my iPhone to Edge rather than 3G. I'm curious as to how Sprint's 4G works and feels. I'm concerned that it will only "feel" like 3G on GSM, but I clearly don't know.

I'd just like to have more reasonable wireless rates. I'm a heavy user due to work and I have several phones with a family of 7. I think it's no secret that the wireless carriers were really making a killing until "smartphones" caused them to spend billions in upgrading their existing wireless networks and coverage areas. I figure that within 5 years we will be using combination cell/satellite phones. In open areas the entire country will be covered with satellites and in urban jungles regular cell coverage will take over. That only leaves remote places with no view of the southern sky as uncovered. As an FYI, the latest security devices my company markets do just that; use GPS as their main tracking but revert to GSM cell coverage if there is no satellite signal. That way, if you're a credit cripple and your lender required a GPS unit to be installed on your car as a loan condition (to make it easier to repo), you can no longer just 'hide' in a parking garage or pole barn.
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Old 03-30-2010, 11:17 AM
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Default Re: New iPhone for fall 2010 breaks AT&T monopoly

I'm glad to hear this. I had a Blackberry Curve with AT&T and eventually wanted an iPhone, but AT&Ts service was horrible. I was out of town for about 6 weeks last year and it seemed that every where I went people with Verizon were getting better signal than I was. I went with Verizon last July and I think the service is a little better. It's not perfect, but better. Now I just have to wait another year for this BB Storm contract to expire so I can get the iPhone.
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Old 03-31-2010, 07:13 AM
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Default Re: New iPhone for fall 2010 breaks AT&T monopoly

I face the same problem of coverage. Even the service they provide is not as good as verizon. My bro is using verizon and he is totally satisfied with it. I was planning to shift to verizon but now after watching this thread I think I will also purchase a new iphone which provides a better services.
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