Will Verizon Marketing Favor iPhone Over Android?

Now that Verizon has Apple's iPhone in its grasp, will it de-emphasize Google Android, the mobile OS seen on so many of its most successful smartphones? The answer is yes, according to one well-known Apple analyst, who sees Verizon favoring Apple and iPhone in its marketing instead of Android-based devices by Motorola and others.

Shaw Wu, an analyst with Kaufman Bros., said in a note to investors on Wednesday that Verizon plans to put "marketing muscle" firmly behind the iPhone, noting that Verizon is "already highlighting the iPhone 4 and the iPad as flagship products with not much else in sight."

Verizon and Apple on Tuesday confirmed that a CDMA version of the iPhone 4 would be available on Verizon Wireless' network starting in February. The move ended long-held speculation that AT&T would lose its exclusive hold on iPhone in the U.S., and discussion of just how many subscribers Verizon stands to add -- and how many customers Apple is set to gain -- is underway. Verizon also confirmed Tuesday that Apple's iPad will have data plans available for its network, too.

Verizon, however, has seen plenty of benefits from Android's galvanizing growth; many of last year's showpiece Android-based smartphones, from the Motorola Droid X to the Samsung Fascinate, are carried by Verizon. And Verizon, it should be remembered, frequently targeted Apple and iPhone in much of its pro-Android advertising dating back to the fall of 2009.

Kaufman Bros.' Wu wrote that a Verizon iPhone will be Android's "first true test," and now that iPhone exclusivity has ended in the U.S., other carriers may get in on it too, even though, as Wu notes, Verizon and AT&T only means the iPhone is "effectively exclusive."

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Some analysts see Verizon adding between 9 and 12 million subscribers in the first year of iPhone availability of its network; the carrier boasts 93 million now. Market researcher IHS iSuppli sees the Verizon iPhone boosting sales of the iPhone by 25 percent, and in a report issued Tuesday, predicted that Apple will ship 12.1 million CDMA iPhones through Verizon and other CDMA carriers this year.

’The arrival of a CDMA version and the addition of Verizon as a carrier will significantly boost the available market for Apple’s iPhone,’ said Tina Teng, senior analyst, wireless communications, for IHS, in the note. ’Potential and current iPhone subscribers in the United States long have been clamoring for an alternative to AT&T.’

IHS iSuppli noted that despite the addition of CDMA technology, the Verizon iPhone shouldn't be any more expensive to make than the AT&T iPhone.

"Given the current iPhone volumes, the expectation is that Apple either already has an intellectual property license from Qualcomm or is using its original design manufacturer's license to cover its current wideband code division multiple based model," researchers wrote.

The iPhone will continue to grow, the researcher noted, saying it expects a long-term evolution (LTE) 4G-compatible iPhone by 2012. IHS iSuppli also sees global sales of iPhone soaring to 98.4 million by 2014, up about 46 million in 2010.