iPhones could double on VZ

Although Apple's exclusive deal with AT&T is expected to last at least through 2010, Bernstein Research analysts Craig Moffett and Toni Sacconaghi claim iPhone sales could double if the device was also distributed by Verizon. The catch, however, would be a drop in subsidies attached to each phone. While AT&T has been estimated to pay a $450 subsidy per device, a non-exclusive deal would likely bring the value down to around $250 to $350.

Verizon CFO John Killian declined to comment on the iPhone, although he did not explicitly deny the possibility of a future deal. A separate report suggests the carrier has been in talks with Apple since before CEO Steve Jobs left on a medical leave of absence.

Apple CFO Peter Oppenheimer and senior Mac manager Tom Boger recently explained that Apple has been satisfied with iPhone sales in a number of countries where the handset is available from multiple carriers. The executives claimed that a Verizon deal is unlikely in 2010 because the carrier uses CDMA technology, while the current iPhone model is compatible with GSM networks.

To overcome the compatibility hurdle, Apple could produce a CDMA variant or wait until both carriers transition to the LTE standard in 2011. Although Verizon is expected to launch LTE slightly ahead of its competitors, a CDMA-compatible phone would still be necessary until the upcoming technology reaches the broader market.

AT&T CEO Randall Stephenson is said to be involved in discussions with Apple to extend the exclusive iPhone deal into 2011. Both companies have not publicly disclosed the terms of the current deal.

By Electronista Staff