Verizon Strives to Close iPhone Gap

When Steve Jobs wrapped up his announcement of the New iPhone 4, another big Apple Inc. event had come and gone with no mention of Verizon Wireless.
That was a disappointment for some smartphone customers. Verizon Wireless executives, too, are eager to get their hands on the phone and speak regularly with their counterparts at Apple.
But the country's largest wireless carriers by subscribers is also working hard on Plan B. By loosening its grip over operations and deepening its relationships with allies such as software giant Google Inc. and handset makers HTC Corp. and Motorola Inc., Verizon Wireless is finally making progress in the smartphone race.
Since announcing a deal last October to develop phones with Google, the carrier has introduced two hit Google-based devices-the Motorola Droid and the Droid Incredible by HTC-and its share of the U.S. smartphone market has risen about a percentage point, to 24.1% at the end of March, while AT&T's fell nearly four points to 41.9%, according to comScore, which measured users over 13 years old.
While AT&T Inc. remains the exclusive carrier in the U.S, Verizon Wireless is working with Google to develop a tablet computer, and other Android smartphones are slated for release this year. Verizon Chief Financial Officer John Killian told a group of investors on May 18 that, "We are going to do as well as if we had the iPhone."
Backing up that statement will take more work. When Verizon Wireless passed on the chance to carry the iPhone four years ago, it fell far behind AT&T in sales of smartphones and data services-the mobile Web browsing, messaging and wireless application download that are fast replacing phone calls as the driver of wireless revenue.
More Verizon Wireless customers are buying smartphones, but just 16% of its customers over 13 currently carry them, compared with 33% of AT&T's, according to comScore. AT&T also collected 18% more a month in data revenue per customer than Verizon last quarter.
Adding to the pressure, AT&T Monday changed its data pricing, instituting usage limits for new customers but lowering the minimum smartphone service plan to $55 a month, compared with Verizon's $70 a month.