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Summary:

This time the rumors that the iPhone will be sold by Verizon Wireless sometime around the end of the year must be true.

On Monday, anonymo…

Happy iPhone User At AT&T
photo: AP Images

This time the rumors that the iPhone will be sold by Verizon Wireless sometime around the end of the year must be true.

On Monday, anonymous sources told the Wall Street Journal that there were two new iPhones in the works, including one for the Verizon Wireless network. Now, there’s additional unnamed people leaking information to the publication that defends AT&T’s network quality, saying that the second-largest operator has taken drastic measures to prevent dropped calls. Not only that, but AT&T (NYSE: T) is quoted as saying that it believes any rival that picks up Apple’s smartphone for the first time will experience the same growing pains.

Is it a coincidence? No one knows for sure, but the back-and-forth publicity stunts in the WSJ hint that the battle for the iPhone subscriber is heating up for the first time in U.S.

Never before have we known what it’s like to have the iPhone available on multiple networks here. Since the first iPhone rolled out in 2007, AT&T has had a firm grasp on its exclusivity. Now, analysts and these unnamed sources are saying that one of two upcoming iPhones will be slated for Verizon Wireless and will come out closer to the end of the year. The other one will be released in July, which is the typical timing for a new iPhone release (and in this case, will likely still be an exclusive to AT&T).

But if today’s article in the WSJ is any indication, AT&T is afraid that consumers, who have heard horror stories from their friends about dropped calls and connection difficulties, will hold out and wait for the Verizon Wireless version later this year. Instead, AT&T wants you to know that it is doing everything it can to improve the network experience, including tapping Apple’s expertise on the phone.

According to people familiar with the situation, in mid-December, AT&T executives set up a 100-day plan to dramatically improve the company’s network in densely-populated cities, WSJ reports. Since then, AT&T has added new spectrum to better handle traffic, repositioned antennas to improve reception and wired more neighborhood cell towers with faster connections. AT&T routinely says that its network handles more data than any other in the world. This year, it will spend $2 billion more on building twice as much capacity as it did last year. Help also came on the handset side. AT&T provided a “crash course” in wireless engineering to Apple (NSDQ: AAPL) designers to help limit the load that iPhones put on the network.

AT&T’s problems have been almost comical at times. Verizon Wireless launched a very successful ad campaign around AT&T’s coverage flaws with the phrase, “there’s a map for that,” and AT&T lost a lawsuit over it. AT&T launched an iPhone app that let’s you mark the spot, where you dropped a call. More solid solutions came as recently as last week when AT&T said it was launching a femtocell in April that allows you to install a mini-cell tower in your house to receive better coverage.

While this is likely all good news for consumers, as we’ve cautioned before, don’t look to as iPhone competition as the end to all of your problems. In Europe, where exclusives have pretty much vanished, there have been two noticeable trends: First, increased competition has not translated into lower prices. In fact, some carriers even charged more, and competition did not lead to better network coverage.

  1. This rumor is bunk. The CDMA iPhone in Question is this year’s update to the China Unicom iPhone – which is CDMA but TD-CDMA (different than american CDMA).

    If you remember last year when all the verizon rumors started due to an Apple job post for a CDMA engineer, it turned out to be the China Unicom version. Apple has never invested in old technology and American CDMA has already started the death watch with AT&T and Verizon openly stating they are moving to the global standard of LTE starting this year. Apple has never been about capturing more market share…they are about profit plain and simple. If they were after marketshare they would have never made exclusive agreements in the first place. But they did so they could command $600 per iPhone from their carrier partners. If they were about market share they would have released $500 laptops by now…but they didn’t. Apple is about a premium product at a premium cost.

    Anyone that knows anything about business will also tell you that Apple (and all companies) use the press to artificially inflate their stock price prior to product launch. Need proof. Visit the youtube video, scroll to 3:30 in and watch Crammer explain how Apple specifically does this. He basically describes exactly what happened yesterday – calling newspapers and leaking fake stories – which can’t be disproved because Apple “doesn’t comment on ongoing projects”. Brilliant isn’t it?

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  2. Verizon and AT&T = The Most Expensive Wireless Calling Plans in America

    Wireless Profit Margins:

    Verizon Wireless = 45 percent

    AT&T = 39 percent

    Sprint = 18.2 percent

    Now we know where Verizon and AT&T get all that money to run commercials 24×7, pay out huge executive bonuses and hire armies of lawyers and lobbyists — the American consumer.

    Not all pricing claims are the same. The advantages consumers get with Sprint’s $69.99 Everything Data plan include nationwide unlimited text and picture messaging, unlimited Web, unlimited GPS navigation and unlimited calling to any mobile in America, compared to AT&T and Verizon’s $69.99 pricing plans, which are good for unlimited talk only. And Sprint’s $69.99 plans are available with any phone while AT&T and Verizon’s are limited to lower-end phones.

    AT&T and Verizon have attempted to confuse the marketplace by lowering their pricing to $69.99, but theirs are for calling only. In today’s economic environment customers are interested in more than just voice pricing. They also want the best value for all the other things they rely on their wireless phone for and Sprint delivers. Sprint’s Everything Data plans start at $69.99 per month and include Any Mobile, Anytime for unlimited calling with any U.S. wireless user, plus unlimited text, picture and video messaging, e-mail, Web browsing, social networking and more.

    4G wireless–which operates at speeds up to 10 times greater than today’s 3G networks–could become a reality for many businesses and consumers over the coming year. Sprint, the current 4G leader, says it will introduce its first 4G smartphone before mid-year.

    Sprint’s fourth-generation phone — the HTC EVO 4G — will be available this summer and run Google’s Android software.

    The phone also will be able to act as a mobile hotspot, allowing customers to connect up to eight Wi-Fi enabled devices. As a result, people could use the phone for their Internet connection for a laptop or desktop computer.

    Where 4G isn’t available, the phone will use Sprint’s 3G network. It will be available through all the usual Sprint channels and RadioShack, Best Buy and Wal-Mart.

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  3. Dean, posting the same thing repeatedly is going to get you banned.

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  4. Apple best stock hands down Wednesday, March 31, 2010

    Dean you freakin Sprint pumper. WTF

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  5. I don’t think people hear horror stories about bad iPhone service from their friends. They just read about it in tech blogs. I have a lot of friends with iPhones. None of them have horror stories. They all love their phone, and have no issue with their service. I don’t have any friends in New York or San Francisco, so maybe that is where the horror stories come from? I don’t think they are representative of the average user’s experience though.

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  6. Horror history, I paid for one year and a half two family plans with AT&T, even do my husband call to complain after two months with them, telling them that the services was too expensive, they look on their database and they told us everything was e ok. I was not happy (not with paying 130 dollars every month for two phones with not net or text, neither with the cover on the area in which I live) and 6 months before the contract run out I called to see how much it would be my way out, and then they told me…. “but you are paying two family plans instead of one…” ” we will fix it, but we can just compensate you for the last 6 months, anything further than that has run out”, to end, they return me 6 months (but not the other one year I paid double). Their service SUCKS!!!, all of it. I am a mac user and I will never go with AT&T again, no matter how much they raise their bars, even if they are the only company with iPhone, and believe me I will love to have an iPhone.

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