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Summary:

What kind of a deal with the devil has Cingular done to get at the hottest mobile phone in the business? Verizon Wireless now says they walked away from the iPhone deal nearly two years ago largely because of Apple’s high financial demands and control of […]

What kind of a deal with the devil has Cingular done to get at the hottest mobile phone in the business?

iPhone photo by Niall KennedyVerizon Wireless now says they walked away from the iPhone deal nearly two years ago largely because of Apple’s high financial demands and control of retail distribution and device support. Jim Gerace, a Verizon Wireless vice president tells USA Today plainly “We said no.” Verizon Wireless spokesperson Jeffrey Nelson tells us:

“We were extremely concerned that Apple’s tight grip would mean that our great distribution partners – WalMart, Best Buy, BJ’s Wholesale – would be left out of the equation. And we weren’t going to let that happen.”

Right, can’t forget BJ’s!

This makes it look like Steve Jobs iPhone strategy will follow the Apple’s standard retail model more closely, avoiding the average electronics store and concentrating on sales and support out of the Apple digs.

We’re wondering what Verizon had more of a problem with – the retail outlets, or the reported cut of the monthly subscriber fees? According to our sources Verizon Wireless was also in serious exploratory talks over an MVNO with Apple. Well that clearly didn’t go anywhere.

Regardless, it’s clear that Jobs had been negotiating with the country’s two largest wireless carriers for a few years. What we wouldn’t give to learn more about the details of the Apple’s Cingular deal — will the largest mobile deal of the year end up being a smart deal for the nation’s largest carrier?

Photo by Niall Kennedy via Flickr

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  1. AT&T is a brand name known for Quality (I am sure Apple knew about the name change during the talks) Apple is a brand known for Quality.
    Verizon is known as that company with a nerd that says “can you hear me now?” Verizon’s service is better? I guess that depends on where you live and what service you are using. I have had ATT Wireless/Cingular for nearly 10 years and the service has been outstanding.

    Anybody that had any knowledge about the telecommunications industry knew that once the SBA – AT&T merger was announce that AT&T would be the name and soon Bell South would fold in and Cingular would become a single company with the AT&T name (remember Cingular already owned the AT&T Wireless name – AT&T WIreless was a separate company from AT&T and used the name under license). These mergers created the largest land line and wireless company in America.

    I believe the Verizon talks where more likely a fall back position or a bargaining chip. I am sure Steve wanted the iPhone to be on the number 1 network and it is.

    AT&T has much more to offer than does Verizon in the terms of financial ability to support network growth. Remember Verizon Wireless is a joint venture so there is a partner to satisfy also. Lets see that partner is Vodafone – seems they intend to offer the iPhone in Europe from recent news. Make of that what you will but I can’t imagine Verizon Wireless rejecting the deal and Vodafone accepting it. I would think Verizon got beat out by AT&T.

  2. i feel that wpple should join with at&t and cingular because of the iphone and i dont understand why it is not…are they ever going to make an iphone for cingular?

  3. Why did Verizon reject the first iphone?…

    It was widely accepted that the initial AT&T- Apple deal included a monthly payout from AT&T. This was very very unlike traditional carrier-device vendor deals, and required a significant shift in thinking and perspective on part of a carrier to accept…

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