Wednesday, May 19, 2010

Why Apple needs Verizon

If one looks at the current mobile OS landscape, it’s not difficult to draw certain parallels with the history consumer desktop computing has endured over the last 30 years.  Apple’s iPhone and Google’s Android are arguably the two hottest players in the smart phone market currently.  While Blackberry and Windows Phone are there, they aren’t generating the same degree of buzz or interest (yet) and that is producing a not so unique rift in consumer philosophy.

In one corner Apple maintains its closed environment with both hardware, software, and development.  In the other corner you have Google with Android, which as strange as it sounds mimics the position Microsoft had with Windows during its rise to dominance during the early 90s.  Google has a fast and growing mobile strategy that takes advantage of a variety of handsets and giving the end user freedom to develop and install software as they see fit.  Apple wants total and complete control, period, while Google is promotes more consumer choice and freedom.  I won’t argue which way is correct because it’s highly subjective based on user preference and arguments are had from both sides.  However one other differentiating factor is while Apple has been locked in with a single wireless carrier (AT&T), [another means to exert control over the user experience of the iPhone] Android is available on all major US carriers with flagship products on 3 of those 4:

  • Droid Incredible (Verizon)
  • Nexus One (T-Mobile)
  • EVO (Sprint)

Each of those offerings provide exceptional competition to Apple’s iPhone 3GS on AT&T and from recent reports Android on a whole has a growth rate that is astonishing.

Apple needs to diversify their carrier options if they want to keep their lead.  Verizon has long been thought of as the logical choice for the iPhone (even Apple thought so during the initial launch but Verizon turned down the offer) thanks to their excellent network:  both in speed and reliability.  If Apple chooses to remain only on AT&T they limit their customer base and for various reasons (contract, dislike of carrier, etc.) make it difficult to get new users.  Meanwhile with Android being a solid OS that Google is grooming into quite a pedigree that is available on a variety of devices on a variety of carriers, it compounds Apple’s competition. 

People not willing to switch to AT&T are finding great alternatives just about everywhere else they look.  That is something that Apple must consider to stay relevant in this rapidly growing segment of computing.  If they don’t they risk repeating their misstep with their battle with Microsoft.  In early June it is expected that the next version of the iPhone will be announced at Apple’s WWDC, the world will surely be listening for another carrier to be revealed.