Verizon Said No to Apple's iPhone Two Years Ago

Verizon Wireless revealed this week that it had been approached by Apple roughly two years ago for a partnership deal with the iPhone but later rejected Apple's proposal because Apple's terms were not mutually beneficial. Apple's international phone uses GSM mobile technology, which Cingular supports but Verizon Wireless does not (Verizon phones use CDMA technology). It logically follows that Apple may have been at the time considering CDMA, which some argue gives better reception and signal strength than GSM.

So what exactly made Verizon hesitate? Reports indicate that Apple wanted to receive a percentage of subscription fees from Verizon customers who purchased the iPhone. Apple also wanted complete control over how the iPhone was developed and how it was launched. Verizon wasn't very happy about this idea: "We said no. We have nothing bad to say about the Apple iPhone. We just couldn't reach a deal that was mutually beneficial," said Verizon Wireless vice president Jim Gerace. Mark Siegel from Cingular had a contrasting view: "We think this is a win for Apple, and it is a win for Cingular."

Apple's iPhone will launch in July from Cingular with a two-year contract, priced at $499 for the 4GB version and $599 for the 8GB version.

Link: Forum Discussion (Thanks Hurmoth)
News source: DailyTech

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I don't see why Apple even considered approaching them unless they wanted a US only phone. 10 countries to support compared to every country in the world? Doesn't make much buisiness sense.

They want to take the US market first. They don't care about the rest of the marketplace until they have established dominance in the US market. Later, they can adapt to take over the other markets, but right now they intend to dominate the US market. This is just the first step in a much longer plan.
Now, whether they actually succeed in the US marketplace or not remains to be seen, but if they can duplicate the business plan that produced the iPod's success, then the Cell Phone industry might as well start planing their layoffs now.

Verizon's service is subpar anyways... if you want a phone to work... at least in my experince... it shouldn't be on verizon's network

Never seen that myself, its actually the opposite where Verizon works the best, Cingular the worst, TMobile the 2nd worst, Sprint 3rd then verizon... and I have Sprint so you cant call me a Verizon fanboy either... I switched from Verizon...

neufuse said,
Never seen that myself, its actually the opposite where Verizon works the best, Cingular the worst, TMobile the 2nd worst, Sprint 3rd then verizon... and I have Sprint so you cant call me a Verizon fanboy either... I switched from Verizon...

Yeah, same. Except I'm still on Verizon.

I could never get reception when I had Cingular. Ever. And it's not like I live out in the middle of nowhere. Verizon has coverage EVERYWHERE I need it.

Now what is sub-par about Verizon is how it locks down the phones. That's why I put the Alltel firmware on my RAZR.

Guess it just depends on where you live... i live in a large suburban area and have zero bars... I use cingular now but still have verizon because canceling all our phones would be 600 bucks and our contract is up in one more month... i can't wait.

Does anyone realise that Apple is not letting the carrier/s subsidise the iPhone - so what you are seeing is the full price of the phone rather then the subsidised price that you can purchase most phones from carriers at.

Here - a AU$200 phone on a $12 month contract - is actually around AU$400-500.
The iPhone would cost around AU$800-900 here unsubsidised.

Now given that I currently own a phone that was retailed at AU$1200 - an O2 XDA II Mini - I can understand that price.

Apple isn't allowing the companies to subsidise the phone - because it would be shooting themselves in the foot when they release a touchscreen iPod

Imagine this - Cingular - releases the iPhone for US$300 - subsidising the price.
Apple releases the Touchscreen iPod for US$350 - and who is going to buy it?

And no - the iPhone isn't a phone - its the PDA version of a phone.
Many people happily buy O2 phones for these prices - professionals sure do.
Many others use cut down versions - who here has a phone with windows mobile - or a derivative on it.

the iPhone isn't just a phone with mp3 and calendar support - its the Apple equivalent of an XDA

I suggest you actually look at the phone, its features and its pricing structures before you get on your high horse and say - oh thats to expensive - or even those knee jerk reactions - its apple.

Unfortunately in the computing industry there are far to many people that are biased and 'fan-boys' that they automatically reject technologies because its apple - or its microsoft - or its not open source.

To those people - unless you have valid reasons to argue against a product - shut up. I am sick and tired of hearing the rhetoric that you spurt out without thinking because you are to simple minded to look at something and make a judgement based on the product rather then your own biased views.

I am a Mac/PC technician - specialising in networks with both - I manage both PC Primary / Apple Secondary and Apple Primary / PC Secondary networks. I have been dealing with both Macs and PC's for years - and both of them have advantages - and both of them have disadvantages.

One of the responses - Typical Apple - in response to verizon saying no. Now I have never dealt with verizon before being in Aust, but if what has been mentioned about raping the phones to charge extra's for features that apple offers for free compared to other carriers - I don't blame apple for not allowing that.

Have you even thought that a phone being sold by a telco at the full price - means that its possible for the telco to offer the service at a lower price - as I have seen outlined in numerous articles around the net in the last couple of weeks.

You are also arguing features on a phone/xda that has yet to gain FCC approval and is a first revision.

Its like Nokia entering the telecom market for the time - no first product is going to have every feature you want - they announce a single product - and then later on having judged the market release revisions with differing configurations/services.

I doubt that would be the case anyways. I like the iPod for the sheer size of the space. How would an 8GB phone impede on sales of an 80GB MP3 player? Both products are aimed at different markets. For someone that just wants an mp3 player, the iPhone doesn't make sense at all to get. It just costs too much for the limited space compared to Apple's iPod line.

I would much rather have the Touchscreen iPod for $350 than pay $300 for a phone with 1/10 the capacity.

the iPhone isn't just a phone with mp3 and calendar support - its the Apple equivalent of an XDA

Very good argument, except for one fact, all the limitations apple has placed on the devuice makign it more limited than a $200 phone. you know the average phoen with calendars, notebooks, MP3 players, memory card slotshone, ability to install ANY Java or symbian app.as well as pretty much everything else and more than the Apple "smart" phone offers.


compared to Widnows mobile bases smart Phones/ xDA's. The iPhone has no benefits, except for being an Apple product and multitouch. one a dubius honor I don't care for, the other a useless features that isn't all that usable in reality.

I've been trying to figure out what makes the iPhone different from the other 200+ phones-with-internet-access-and-mp3-player that have been around for AT LEAST the last 5+ years... I mean, dosen't EVERY phone company have one with a camera, web browser (uh, is this not how Opera got its start into the bigtime?), mp3 player, personal organizer, etc?
I saw like 50 of them in this weeks Best Buy flyer so I'm thinking what happened is that everyone in the mobile phone industry went forward in time using stolen time travel technology, listened to Steve Jobs' press release, then went back in time and designed all these devices?
The phone probably wouldn't be $500 if Apple also sold cellular service contracts with it... next question is, will any of the current cellular companies push a rebranded iPhone (assuming Apple isn't too f-tarded to take up this idea), or will they all be more than content to let it die slowly as they push their own mp3-phones for $100 or less...?

Methinks iPhone has about as much future as the Mac itself... yeah, there will still be iPhones in 10 years, but only for people who feel better about spending more money on something than everyone else, thinking that hey, if it costs more, it must be better......

The difference between an Iphone and every other phone or smartphoen with the same or more rfucnitonality.

all the other phones aren't on the frontpage of every newspaper all over the wrodls, and every techsite for every little announcement. after all do you see any other phones popping up on the neowin frontpage announcing what carrier in Canada will be offering the phone ?

that's the difference... oh yeah. and he the iphone costs more for less.

nothign was stopping them from making a GSM and CDMA phone (two different models) heck most of the phones out now you can buy for one and the other both!

According to the CDMA Development Group, there were 256 million CDMA subscribers worldwide as of March 2006 compared with approximately two billion GSM subscribers. Western and Eastern Europe are almost exclusively GSM, while GSM subscribers outnumber CDMA subscribers by ten to one in the Middle East and Africa.

Can't believe anyone still considers Verizon/Sprint/etc....

I can see why this fell through. Especially given the fact the Verizon has created a unique (albeit crippling) eco-sytem for their phones based on BREW technology. I really don't think Apple would have allowed Verizon Wireless to cripple the iPhone the way Verizon neuters all its other handsets. And good for them. The Verizon UI is lackluster and would've hated to see something like that on the iPhone.

the good thing the iphone features are crap and nothing compared to the nokia n95 so i am not getting that crappy 2mpx without autofocus iphone

Is there any way for CDMA to ever adopt SIM cards? I don't like CDMA because you are locked to a phone, as opposed to a SIM card that can be placed in any phone.

drygnfyre said,
Is there any way for CDMA to ever adopt SIM cards? I don't like CDMA because you are locked to a phone, as opposed to a SIM card that can be placed in any phone.

CDMA carriers can use R-UIM chips which are much like SIM cards. However, most CDMA carriers choose not to in order to exercise greater control over which phones you can use. Many of the newer Nokia CDMA phones have R-UIM slots but are non-functional because of this.

Holy $@%^%$^ "Cingular with a two-year contract, priced at $499 for the 4GB version and $599 for the 8GB version"? you have got to be kidding me... I'll go buy a Cell and build a new comp for that $600 I would spend on that potentially (plus tax and regulatory taxes and fees)


btw... Cingular doesn't exist anymore... It's AT&T again... it was official immediatly a couple weeks ago

I'm not surprised.

It sounds like Apple went to Verizon pitching the iPhone and then told Verizon how they should run their business. I'd tell Apple to go **** off too!

i agree and could see real problems when it came to diagnosing a problem and verizon saying its apples problem then apple saying its verizon problems

I actually feel lucky that Apple went with Cingular. At least now there's no chance of Verizon crippling the phone and charging extra for everything.

wctaiwan

wctaiwan said,
I actually feel lucky that Apple went with Cingular. At least now there's no chance of Verizon crippling the phone and charging extra for everything.

wctaiwan

lol, but so true.

Netrack said,
i agree and could see real problems when it came to diagnosing a problem and verizon saying its apples problem then apple saying its verizon problems

Right, only Cingular customers will have to worry about that now.

I'm a bit frustrated, alright? Sure, Apple wasn't being too fair with Verizon, but I would love it if I could have the iPhone. I just can't stand Cingular, and in any case I'm on contract with Verizon for quite a bit longer.

raskren said,
Thanks for your thoughtful, intelligent contributions to the community. :rolleyes:

Thanks for wasting even more space for that troll semi flame comment. Next time just ignore it.

I second that "GAH!" I have Verizon and that phone looks great, would've definitely thought about it when my contract expires here soon, all my friends & family with the exception of one friend all have Verizon so I won't switch companies. I hardly use any "other-than-IN" calls or text messages.