Verizon to start offering iPhone in January 2011--reports

If these reports turn out to be true then this most certainly means end of AT&T’s reign in smartphone market in the U.S. that started back in 2007 when the carrier became iPhone’s exclusive carrier.

Not just Verizon Wireless spokesman Jeffrey Nelson, but Apple spokeswoman Natalie Kerris, too, declined to comment on the ongoing reports.

Apple’s exclusive U.S. carrier, AT&T, too was not in the mood to entertain any queries regarding the rumor.

Switching to Verizon Wireless a smart move by Apple
Ever since the launch of iPhones, AT&T has the exclusive contract to sell the device on its network. This contract with Apple helped AT&T a lot in improving its financial situation.

If the recent reports turn out to be true then this most certainly means the end of AT&T’s reign in smartphone market in the U.S. that started back in 2007 when carrier became iPhone’s exclusive carrier.

However, things did not stay like they were initially. As the demand for the iPhone increased, AT&T’s network started to crumble under the pressure and in the past few months faced heavy criticism for providing less than satisfactory services.

But analysts believe that this situation will change once Apple ends its exclusive contract with AT&T and spreads the load onto other carriers like Verizon Wireless.

"For Apple, it means a larger addressable market. It's also good news for Apple in that it will spread the load on the wireless data networks," believes Andy Hargreaves, an analyst with Pacific Crest Securities.

Apple’s switch to Verizon Wireless was expected
Apple and Verizon might be quite on the whole issue. However, Wall Street analysts had already predicted, after seeing AT&T struggle, that Verizon at some point in 2011 will get the chance to offer highly popular and in-demand Apple iPhone on its network.

Market analysts also believe that it’s a good decision businesswise for Apple, as in recent past there have been enough examples of AT&T’s incapability to provide satisfactory services to iPhone customers single-handedly.

"We believe the iPhone would be a plus for Verizon, but not a significant industry change, given the relative stickiness of smart-phone customers, as the primary source of Verizon iPhone [subscriptions] would be pent-up demand by existing Verizon [subscribers]," said Jeff Kvaal at Barclays Capital.

Some analysts also believes that once Apple gets out of the exclusive contract with AT&T, it most certainly will consider increasing the numbers of iPhones sold in the U.S.

"Apple is going to dramatically increase the number of devices it sells in the U.S. when exclusivity at AT&T ends. It's hard to ignore the quality issues that AT&T has faced,” believes UBS analyst John Hodulik.