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Why Verizon Doesn't Want You to Buy an iPhone

M

MNealBarrett

macrumors member
Original poster
Feb 25, 2006
60
0
Very good article here. I am sure fanboys here are immediately jumping to the conclusion that Verizon just hates Apple. But the reason for this policy is simple, and it isn't Apple-hatred: Verizon's 3G network is clogged up, Verizon has plenty of space on their 4G network, and iPhones do not support 4G. Simple as that. If all Samsung phones were 3G-only, they'd be dissuading people from buying Samsung phones also, for example.

http://www.pcmag.com/article2/0,2817,2404002,00.asp
 
Do we really need another Verizon bashing thread. I'm not on Verizon so you can't say I'm biased. There been like 4 threads in the last 2 days.
 
It's not the spectrum. It's the high subsidy cost associated with the iPhone versus other Smartphones. Would you rather subsidize a phone that costs $449 out of contract or a phone that costs $649?
 
It's a combination of all of the issues in the article. The big picture issue is the high cost of having the iPhone. The short term issue is the iPhone being on 3G, something that will change when the iPhone (late 2012) is released.
 
ixodes said:
The OP is *not* bashing Verizon.

All one has to do is read the post to verify that.
Click to expand...

I wouldn't call it bashing, it's more of a what people can expect when they walk into a Verizon store. I can understand Verizon's (speculated) reasoning, but doesn't mean I agree with it. I think connectivity and speed matters to a point. For example, you might hype up 4g and about being ready, but you don't have 4g in your area. And if you do, you barely use any data via cellular network and it's all WiFi, yet they still sold you a 4g phone due to "faster speeds" without getting the proper requirements. In the long run = less customers. Apple get's this, that's why their customer services is second to none.
 
The "carriers" whether it be Verizon, AT&T, Sprint etc are in what is admittedly a very competitive business. One which relies on carrying a selection of phones that they have very little control over. Yes, they work with the manufacturers & each carrier has a limited amount of control. Yet, they work on narrower margins than quite a few other industries.

Next one must factor in the fickle customers, who choose the phone they buy based on a very broad set of variables. Therefore the business of being a cellular service provider is quite challenging.

While I'm not advocating for any of them, I find it curious that so many Apple customers are so bent on taking out all their anger and frustration on a particular carrier. All the while maintaining Apple can do no wrong.

It can be said with accuracy, that Apple builds excellent, premium products, but perfect they're not.
 
The real question is, why would anyone want to buy an on-contract iPhone on Verizon at this point anyway? The LTE iPhone is a few months away. People who get an iPhone now won't be able to get a subsidized 4G device until 2014.
 
The point is , Verizon reps make more commission from selling phones other than iphone. Thats just the way it is.
 
Stupid article. If it isn't about the subsidies. Than when iPhone LTE is announced.*

If Verizon didn't care about subsidies and moving people to LTE. Verizon will kindly let iPhone 4s users who brought last October have their full subsidy upgrade moved up by 8-9 months. *That way their 3G networks would be less stressed without 3G iPhone users right?

Again idiot story. It is always about the money and profits. Look in June 2010 AT&T was being super nice to move many iPhone 3GS users eligibility up by 6 months to get the iPhone 4. People thought AT&T was being nice. *

But we all smelled something was up. Cause 7 months later Verizon got iPhone 4. AT&T did it not out of kindness. They did it to lock in contracts and also upped the etf to $325 in June 2010 to prevent people from leaving.
 
I hope is can balance some of the negative impression that AT&T made earlier this weekend. By the way, it's up to Verizon how much they are to charge for data traffic.
 
I agree 3G EVDO is saturated, to the point of absurdity in most areas. Here I am lucky to get 0.75Mb/s most of the time (about 1/4 or so of what RevA is capable of).

Verizon also has a problem and it will be exacerbated with an LTE iPhone. That problem is the vast difference between the old EVDO (3G) network and their shiny new 4G LTE one. When folks are forced to use that old 3G network the data speeds drop by as much as 90%. AT&T is in a much better position here as HSPA+, while not the top dog, is very competitive...and users won't notice such a drastic drop going from LTE to HSPA+. Slower, but nowhere near 90% slower.

Then there's that CDMA problem with data and voice but I guess we've agreed that is a non-issue; It is an issue for me personally and has kept me away from a Verizon iPhone personally.
 
As with anything in real life, "it's complicated" and there are a variety of factors in play here.

* The spectrum issue is a real one - the article has merit. The bits/hz spectral efficiency that LTE gets is much higher than EVDO. Verizon watches things like this and is obviously taking action. They've done similar things in the analog to digital transition - this isn't out of character at all.

HOWEVER, at the same time:

* VzW also fears becoming beholden to one or a few suppliers, especially dominant ones. This is true on the handset side as well as the infrastructure side. They want as many horses in the race as they can get - basically they'll bet on all of them if they can. Windows phone? Sure, pile on...

HOWEVER, at the same time:

* VzW also wants the hot products - meaning, the iPhone. They know that if Apple keeps on cranking out desirable products, then VzW wants to offer those products. It keeps ARPU up as hot products can withstand pricing pressures.

HOWEVER, at the same time:

* VzW watches the bottom line closely, and I'm sure the iPhone subsidy bothers them if it's materially higher than other phones.

...and so on and so forth.

A couple of other thoughts - first, I don't believe the "no commission" angle one bit. There are manifold ways to influence sales staff which don't involve a direct commission. Spiffs are one example. You can also give store managers and regional managers quotas and they'll get the message to the line sales people very unambiguously even if nothing is written down anywhere.

Also, as we all know, there's a massive hit to the network whenever an iPhone is released. Verizon keeps a VERY close eye on network performance and they plan ahead very well - they're very proactive in this area as opposed to reactive - they spent nearly a year throwing vast sums of money at their EVDO network to get it ready for their iPhone launch - I estimate it was well over a billion (with a B) dollars and was likely even more than that.

They may be pushing as many devices to LTE as they can to so they can get the best idea of how their LTE network works before the LTE iPhone rolls out. Test networks and "friendly users" are great up to a certain point, but stressing the network with real users is always the best test.

But, of course, this won't be the ONLY reason why they'd push other devices... Like I said, "it's complicated."
 
smithrh said:
As with anything in real life, "it's complicated" and there are a variety of factors in play here.

* The spectrum issue is a real one - the article has merit. The bits/hz spectral efficiency that LTE gets is much higher than EVDO. Verizon watches things like this and is obviously taking action. They've done similar things in the analog to digital transition - this isn't out of character at all.

HOWEVER, at the same time:

* VzW also fears becoming beholden to one or a few suppliers, especially dominant ones. This is true on the handset side as well as the infrastructure side. They want as many horses in the race as they can get - basically they'll bet on all of them if they can. Windows phone? Sure, pile on...

HOWEVER, at the same time:

* VzW also wants the hot products - meaning, the iPhone. They know that if Apple keeps on cranking out desirable products, then VzW wants to offer those products. It keeps ARPU up as hot products can withstand pricing pressures.

HOWEVER, at the same time:

* VzW watches the bottom line closely, and I'm sure the iPhone subsidy bothers them if it's materially higher than other phones.

...and so on and so forth.

A couple of other thoughts - first, I don't believe the "no commission" angle one bit. There are manifold ways to influence sales staff which don't involve a direct commission. Spiffs are one example. You can also give store managers and regional managers quotas and they'll get the message to the line sales people very unambiguously even if nothing is written down anywhere.

Also, as we all know, there's a massive hit to the network whenever an iPhone is released. Verizon keeps a VERY close eye on network performance and they plan ahead very well - they're very proactive in this area as opposed to reactive - they spent nearly a year throwing vast sums of money at their EVDO network to get it ready for their iPhone launch - I estimate it was well over a billion (with a B) dollars and was likely even more than that.

They may be pushing as many devices to LTE as they can to so they can get the best idea of how their LTE network works before the LTE iPhone rolls out. Test networks and "friendly users" are great up to a certain point, but stressing the network with real users is always the best test.

But, of course, this won't be the ONLY reason why they'd push other devices... Like I said, "it's complicated."
Click to expand...

Love the response! Just like my favorite Fox news line, "Fair and Balance" analysis.

As with anything involving money, business, and profits. It is indeed complicated.
 
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