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Verizon Could Face Up to $14 Billion in Unsold iPhone Purchase Commitments for 2013
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very true, I went in looking for info on my first iphone (5) and whole sales team told me how terrible the battery life was, to get a moto droid etc.
battery life on the 5 isnt even bad.
worst negociation ever
FAIL
I know! even Sprint had a better deal, and we know how desperate they were!
I can speak for three states. I have never seen an iPhone on display in a Verizon store. Occasionally an iPad.
Not finding that to be the case. Thinking it has to do with the Verizon practices of selling.
To note: The NHL premium during the playoffs? Verizon was big pushing that it was free for their 4G LTE smartphone customers and tablet customers.
But... "4G LTE smartphones with the exception of the iPhone 5" was the reality.
Verizon STILL treats the iPhone, one of, if not the, best selling handsets in their history, as a second class citizen.
This has been my experience at Verizon Wireless corporate kiosks in shopping malls. I gravitate toward iPhone. Sales reps ALWAYS talk the iPhone down and go on and on about the wonders of Android anything.
Several have told me that iPhone screen is too small and try to steer me to a huge thing I cannot even hold comfortably.
Please understand this is just a happenstance slowing down in a mall. I am not in the market for a phone. I am a VZW customer with two feature phones out of agreement. If I let them actually look up my account they would probably follow me home with a boatload of handsets I don't want.
Apple approached VZW first with iPhone. VZW execs showed SJ the door. ATT was second choice. VZW would not offer iPhone without compelling customer demand. And yes, they definitely penalize reps for activating iPhones.
Cook should make them pay up. I doubt he will unfortunately.
anything at all would be a step up. even if you go in to a verizon store begging for an iPhone, they will push back hard with the droid razr.
worst negociation ever
FAIL
They will not get hurt, as they will re-negotiate and Apple will make concessions and get something in return.
Storm in a water glass
Didn't the iPhone first come to Verizon in June of 2011? I be a bunch of iPhone 4 users are just waiting until the 5S comes out to upgrade.
Verizon's got it coming to them - 24 month upgrade wait... I was two weeks away from making the cut off! They could have more upgrades if they make the wait only 20 months...
"Didn't know any better"?
If they wanted an iPhone, it shouldn't matter what a salesperson says. Maybe they "didn't know any better" on why they wanted an iPhone in the first place.
Reaping what they sow.
My friends switched from AT&T (iPhone 3GS) to some free Android phone on Verizon. After the contract, they tried to get the free iPhone from Verizon.
The Verizon rep told them there's no such thing as a free iPhone - or a cheap one for existing customers for that matter. There are plenty of free/low-cost Samsungs instead...
He took a pass, but her phone was really bad so she got some Samsung (not happy with that either).
My friends switched from AT&T (iPhone 3GS) to some free Android phone on Verizon. After the contract, they tried to get the free iPhone from Verizon.
The Verizon rep told them there's no such thing as a free iPhone - or a cheap one for existing customers for that matter. There are plenty of free/low-cost Samsungs instead...
He took a pass, but her phone was really bad so she got some Samsung (not happy with that either).
"Didn't know any better"?
If they wanted an iPhone, it shouldn't matter what a salesperson says. Maybe they "didn't know any better" on why they wanted an iPhone in the first place.
If they did that, I would ride my contract out and immediately leave the network. It's not good enough to make up for how much that would piss me off. I'm sure many other people agree. We were patient enough to wait until the iPhone came, because we knew we'd be the first non-AT&T network to get it. Now that every network has it (with US Cellular coming this year), I have no reason to stay with a carrier who is so childish as to drop a device because they couldn't meet the terms they agreed to.
T Mobile will be the carrier I go to if I leave VZW, assuming this nationwide LTE roll-out goes according to their claims.
"Didn't know any better"?
If they wanted an iPhone, it shouldn't matter what a salesperson says. Maybe they "didn't know any better" on why they wanted an iPhone in the first place.
Not everyone is some tech geek. I have plenty of family/friends that could easily be swayed if the salesperson tried to talk them in to something else. I never found this to be the case with AT&T. When I had a crap HTC phone that wasn't working the salesperson talked me in to getting an iPhone.
Where is this 22% decline you speak of? When did Apple report it?
Apple didn't - it's in the article.
Commissioned Sales
Verizon's problem is twofold. 1. The corporate commitment to Apple was, at best, a gross over estimation of their sales projections. 2. If their sales force is commissioned, there is no incentive for the sales people to push iPhones. If I am a VZ sales person and the ability to pay my bills is directly tied to the amount of profit I generate, I am going to push the most profitable items. THAT has nothing to do with a like or dislike of Apple. That's just the pure economics of sales. Maybe if Verizon paid their people a flat salary or hourly wage + a per unit bonus (regardless of brand) instead of commission the sales person would be less inclined to push something other than the iPhone. I am not sure what will work but as it stands now, Verizon seems pretty screwed.
Hypothetical sales person gets paid X% of every phone they sell.
The hypothetical payout breaks down like this:
$8 for every HTC One
$7.50 for every Samsung S4
$9.45 for every BB
$5 for every feature phone - not sure why they still sell these.
$4 for every iPhone
If rent/mortgage, gas, cable, car payment, etc. depended on the numbers above, what would any of us sell?
Verizon's problem is twofold. 1. The corporate commitment to Apple was, at best, a gross over estimation of their sales projections. 2. If their sales force is commissioned, there is no incentive for the sales people to push iPhones. If I am a VZ sales person and the ability to pay my bills is directly tied to the amount of profit I generate, I am going to push the most profitable items. THAT has nothing to do with a like or dislike of Apple. That's just the pure economics of sales. Maybe if Verizon paid their people a flat salary or hourly wage + a per unit bonus (regardless of brand) instead of commission the sales person would be less inclined to push something other than the iPhone. I am not sure what will work but as it stands now, Verizon seems pretty screwed.
Hypothetical sales person gets paid X% of every phone they sell.
The hypothetical payout breaks down like this:
$8 for every HTC One
$7.50 for every Samsung S4
$9.45 for every BB
$5 for every feature phone - not sure why they still sell these.
$4 for every iPhone
If rent/mortgage, gas, cable, car payment, etc. depended on the numbers above, what would any of us sell?
Not the point. Verizon was late to the iphone game period. Not until the 4 did they enter because they were too good for the original back in 2007. Well now looks who's laughing. Me.This isn't an Android handset
And Verizon makes less profit on the iPhone than their other phones to boot.
That's what I was thinking too!
It will be interesting to see how this plays out. If Verizon can't control their greed, then you can imagine they'll keep the iPhone prices inflated as high as possible, hoping to cut their losses that way (and perhaps gambling on future iPhone releases being popular enough to boost their sales back into the zone they projected).
If, however, they want to play a smarter game, I could easily see them giving away iPhones free (or for a penny or something, if some contract detail says they can't just GIVE them away) to hook new customers into contracts -- thereby cheapening the perceived value of the iPhone (and angering Apple, who clearly stated in the past they never want to see that happen to their product).
That way, the money they lose could be considered more of a gamble on advertising/marketing, and trying to buy leverage with Apple. "Take away our minimum sales obligation and we'll stop selling your phones way below cost."
It will be interesting to see how this plays out. If Verizon can't control their greed, then you can imagine they'll keep the iPhone prices inflated as high as possible, hoping to cut their losses that way (and perhaps gambling on future iPhone releases being popular enough to boost their sales back into the zone they projected).
If, however, they want to play a smarter game, I could easily see them giving away iPhones free (or for a penny or something, if some contract detail says they can't just GIVE them away) to hook new customers into contracts -- thereby cheapening the perceived value of the iPhone (and angering Apple, who clearly stated in the past they never want to see that happen to their product).
That way, the money they lose could be considered more of a gamble on advertising/marketing, and trying to buy leverage with Apple. "Take away our minimum sales obligation and we'll stop selling your phones way below cost."