By MG Siegler
Late Sunday night, I spent 1,500 words explaining why Verizon’s Droid, like the dozens of competitors before it, is not the ever-sought-after “iPhone killer.” I really should have just waited until Monday morning and listened to Verizon’s (NYSE:VZ) earnings call. After all, Verizon CEO Ivan Seidenberg more or less said it himself.
When asked about a possible partnership with Apple (NASDAQ:AAPL) in the future with the iPhone, Seidenberg had this to say, “We obviously would be interested at any point in the future that they would be interested in having us as a partner. … This is a decision that is exclusively in Apple’s court.”
Judging from the first Verizon commercial about the Droid project, it would seem that they clearly believe it is better than the iPhone. But if Verizon is so confident in this new device, why would they put themselves through the hassle of dealing with Apple to get what they view to be an inferior device?
Because they don’t actually think that.
The first sentence of Seindenberg’s remarks Monday reads like pandering. The second sentence sounds like Verizon’s way of telling their customers, “we’re doing all we can to get the iPhone.” The latter also confirms what everyone already knew: That Apple and Verizon are talking.
But should we believe that it’s entirely up to Apple if they wants to launch on iPhone on Verizon? Probably not. As the largest carrier in the U.S., Verizon still has some cards it can play against Apple, and you can be sure they’re doing just that. If I had to guess, I would bet that Verizon and Apple are arguing over things ranging from revenue sharing for the App Store to something silly like Verizon demanding their branding be more visible on the device.
Apple, probably not too hot on the idea of rolling out a CDMA iPhone when Verizon is working to roll out its LTE network, probably doesn’t mind stalling and sticking firm in its ground to get the same sort of deals it gets from AT&T (NYSE:T). But Verizon, again, as the nation’s largest carrier, probably knows that without exclusivity, Apple has less of a power-play to make some of those demands.
In the coming months, Verizon will continue to play its cards by rolling out better devices on its huge and largely reliable (compared to AT&T anyway) network. They’ll launch the Droid devices, and roll out the Palm Pre. They’ll do more ad campaigns like “iDon’t” and “There’s a map for that.”
Meanwhile, Apple will either re-up its AT&T exclusivity (set to end next year) for some insane deal, possibly extending it for a year — or they’ll spread the wealth a bit more by rolling the iPhone out to that other U.S. GSM carrier, T-Mobile. Both would put more pressure on Verizon.
What we have is a stand-off. Leverage is the weapon.
But let’s be clear: Not even Verizon views Droid as an iPhone killer. And that’s because it’s not. Instead, it’s likely to be the best device running Android yet — until the next best one comes out in a few weeks or months. Android is all about being everywhere. Again, that’s why it’s a Windows Mobile and Symbian killer, not an iPhone killer. And Verizon knows it, despite their ads.