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From Newsweek

Is AT&T’s Exclusive Lock on the iPhone Over?

Why Apple needs to get its iPhone 4 onto Verizon’s network ASAP.


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The news, if it's true, could be bigger than Apple’s launch of iPhone 4 itself. According to Bloomberg, the iPhone will come to Verizon's network in January.

Hallelujah. Praise the Lord. At last you will be able to own an iPhone and make phone calls with it.

Of course, rumors of iPhone coming to Verizon surface every few months and they're never true. But this time everyone seems to believe it. Bloomberg is citing two unnamed sources familiar with the plan. OK, that's far from a solid announcement.

Nevertheless, it was enough to move Verizon (VZ) shares in the afternoon after the news broke, rising from $28.30 to over $29 before settling back to $28.60—all on a big burst of volume.

Today's report follows on a story from two weeks ago, also based on leaked information, that a contract manufacturer in Asia was working on an iPhone that runs on CDMA, the technology Verizon uses.

So let's assume this report is true and the iPhone really is coming to Verizon. What does it mean?

For customers it's great news. For Apple it's also a plus, since they'll now be able to sell more units.

For AT&T, it's obviously bad news, as customers, myself included, have been loudly complaining about AT&T's unbearably awful network, where dead spots and dropped calls have become so frequent that it's almost impossible to rely on an iPhone.

In my case it's been so bad that several months ago I had to go out and buy a prepaid phone from Verizon. I forward my calls from the iPhone to the prepaid phone and use that for phone calls.

More recently I started looking for a better solution and started using an Android-based HTC Incredible on the Verizon network. It's not as pretty as the iPhone, but it's a great little smart phone and I've been very happy with it.

It's so good, in fact, that even if Apple brings the iPhone to Verizon, I might just stick with an Android-based phone instead.

I'm sure lots of other iPhone users have been doing or considering the same move to Android. These Android-based smart phones are getting really good these days—in some ways they are arguably better than the iPhone.

The truth is, Apple needs to get on Verizon, and fast, or it risks losing customers to Android.

If Verizon gets the iPhone, I'd expect a huge exodus from AT&T. Which probably explains some of AT&T's recent behavior. With the release of iPhone 4, AT&T made an unusual offer to current owners of iPhones, telling them that even if their contracts weren't close to being over, they could still push up their expiration date and upgrade to the iPhone 4—as long as they signed a new two-year contract.

Many people jumped on that offer, and some even viewed it as a case of AT&T being generous. Um, not likely. More likely it's that AT&T knows its exclusive lock on iPhone is coming to an end, and so it sought to lock in as many iPhone users before the deal with Verizon happens.

To those folks who waited in line for hours and hours to take advantage of AT&T's "generous" offer, I can only offer my condolences and point out that, given AT&T's past behavior, you should have known better.

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