The Verizon iPhone is expected to land early next year and many are expecting it to be a big seller and add to Apple’s market share but you may be surprised that some analysts aren’t predicting this will add that many sales to Apple’s bottom line.
Merril Lynch’s Scott Craig said the company is now baking in a Verizon iPhone into its expectations and it’s expecting a healthy 10 million Verizon iPhone units for 2010. But Stifel Nicolaus’ Doug Reid only raised his 2011 sales estimates to 63.3 million from 62.5 million. That’s only 800,000 additional Apple smartphones.
“Historically when the iPhone has been added to a second carrier in a country (France, Norway, Canada, UK, etc), iPhone shipments increased nearly 1:1 with subscriber base, indicating minimal/no share loss at the incumbent carrier,” wrote Reid. “We are more conservative in our estimates, given the more recent increased competition from Android devices and some likely cannibalization at AT&T.”
Surveys have found that there is a high demand for a Verizon iPhone but what people tell surveyors may not be what they do. Additionally, a lot of Verizon iPhone owners may also be users on AT&T who are just fed up with the service in major cities.
There’s also the threat of Android, as the Droid lineup has been a big seller and many Droid users are locked into two-year contracts. Heck, I know I’m still on the hook for the original Droid and unless Big Red waives the upgrade fee, I won’t be switching to Apple’s smartphone.
Additionally, the Verizon iPhone will likely be a 3G-only device the first go around. While the Apple experience will definitely appeal to many, the mobile enthusiasts and tech-savvy may be drawn to Android-powered smartphones which can utilize Big Red’s 4G LTE network like the HTC Mecha. We’re expecting a half dozen 4G LTE smartphones and tablets in the first half of 2011, so the competition will be fierce.