“We believe cumulative Android smartphones may have represented over 50% of total smartphone sales at Verizon for the first time since the iPhone 4S launch. In fact, our checks indicated sales of the iPhone 4S at Verizon were not as strong in terms of total smartphone share at AT&T and Sprint.”
This excerpt from Mike Walkley’s note out of investment bank Canaccord Genuity suggests that the total Android(s goog) device sales are even with — or better than– the iPhone(s aapl) models at Verizon(s vz)(s vod), the largest U.S. carrier. Walkley doesn’t see the same at AT&T(s t) and Sprint(s s), however, and I can only think of two reasons why: LTE networks and two-year contracts.
While all four major U.S. carriers are now publicly committed to LTE for next-generation mobile broadband networks, Verizon was the first among them to launch LTE in December 2010. The carrier says it now covers 200 million people — know as POPs, or points of presence — in 195 markets. The next closest, in terms of coverage, is AT&T, with 28 markets and 74 million POPs. Sprint plans to launch LTE by mid-year in 2012 while T-Mobile is looking to 2013.
Many Verizon customers jumped on the iPhone when the operator finally launched it roughly a year ago. Given that most purchased the handset on contract, all of these subscribers aren’t eligible for another subsidized upgrade until August of this year or later, pending any early upgrade deals from Verizon. That will surely dent Verizon iPhone sales for the next two quarters, but I think LTE is the bigger issue.
The carrier is aggressively pushing its LTE network speeds and coverage. Occasionally it offers double the LTE capacity to attract customers, and it has already said that all new smartphones going forward will be LTE-capable. After spending billions to roll out an LTE network, I’m not surprised the carrier wants to recoup its LTE investment and get customers off the old EVDO network; two things the iPhone doesn’t help at all.