Verizon iPhone more expensive predicts analyst, missing the point completely

Jan 10, 2011
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Verizon iPhone hyperbole continues, with the latest analyst angle being the potential price difference in UMTS and CDMA radios. J.P. Morgan analyst Mark Moskowitz has been crunching the numbers and is predicting that the Verizon iPhone could cost $20 to $30 more than its AT&T counterpart because of the more expensive components, according to Apple Insider.

"The key differentiator is the cost of CDMA-related components. While the acquisition price of the iPhone could be slightly more expensive for subscribers on Verizon, we think that there will be offsets, specifically network performance" Mark Moskowitz, analyst, J.P. Morgan

The prediction seems bizarre, given Verizon is also expected to be offering unlimited data in an attempt to show up AT&T's comparatively limited data caps. Following that path, but then slapping a surcharge on top of the handset for something mainstream customers aren't likely to understand - the difference between CDMA and UMTS radios - doesn't seem at all in keeping with Apple's policies, and would be counter-intuitive to Verizon's supposed strategy.

More likely is that Verizon will stomach any extra wholesale handset costs itself, and push price parity with AT&T's iPhone 4 models. $20 to $30 amortized over the course of a subscriber's two year agreement is nothing in comparison to the ARPU they'll be bringing in.


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