updated 05:10 pm EDT, Wed September 15, 2010
Apple told to end iPhone exclusive to beat Android
Apple has to make the iPhone available for Verizon and other carriers if it wants a chance at competing with Android, Bernstein Research analysts Pierre Ferragu and Toni Sacconaghi urged on Wednesday. Noting that Google has tripled its growth to 200,000 activations per day in just seven months, the bankers called Apple to make the iPhone available for the carriers that have become safe havens for Android, including not only Verizon but also O2 and Vodafone in Germany, China Mobile and Japan's NTTDoCoMo. If it doesn't happen, Android's total installed based could overtake Apple's in about 15 months, Bernstein wrote.
The move would be important even if Apple had to sacrifice some control over pricing. The added sales would still help pad the company's overall gross profit margins and prevent Google from maintaining a "strong foothold."
Apple is technically on more carriers than Google, at 154 versus 59, but the ones Google reaches often have a larger impact. Verizon is larger than AT&T with 82 million full subscribers. Most of China Mobile's customers are prepaid and might not ever see an iPhone, but it still has 90 million subscribers.
iPhones are believed in the works for some of those carriers. The CDMA iPhone could be ready as soon as early 2011, Ferragu and Sacconaghi said, but German expansion is likely. A T-Mobile US version has also gained traction and could lead to editions for smaller Canadian carriers by extension. Some of these are technical challenges, as Apple would need to produce a GSM phone with 1,700MHz 3G to serve T-Mobile and TD-SCDMA to accommodate China Mobile.
No matter which company led in share, Bernstein's researchers expected Nokia and RIM to suffer the most since neither is as interesting to customers anymore. RIM was singled out as needing a "fundamental change" to avoid losing users to Android and iPhone.