Will T-Mobile Score the iPhone Before Verizon?
Here's an interesting new wrinkle to persistent reports that Apple plans to add a second carrier for the iPhone in the U.S. Verizon has long been named as the primary choice to be the first U.S. alternative to AT&T (NYSE: T), but now a report on the blog Cult of Mac says that T-Mobile, not Verizon, will be the next American network to score the popular smartphone.
The blog post says talks are "at an advanced stage," and that "it's 80 percent likely that the iPhone will be coming to T-Mobile in Q3." Cult of Mac said its information comes from a source at T-Mobile, the No. 4 mobile carrier in the U.S.
Will T-Mobile Trump the Verizon iPhone?
Such a deal would mean the exclusive contract between Apple and AT&T is over. No one knows when the deal expires, but it has been widely reported that Apple would choose Verizon, with 92 million customers, not T-Mobile, with 34 million customers as a second carrier.
T-Mobile has been trying to reverse its fortunes by focusing on data-centric customers. It was the first to adopt Android-based phones and René Oberman, CEO of T-Mobile's parent company, Deutsche Telekom, told the Financial Times in March that the company hoped to start selling the iPhone in the U.S. later this year or next year.
It wouldn't be that difficult technologically, since T-Mobile uses a GSM/HSPA network like AT&T. It has made considerable investments in the network and boasts of data speeds up to 7 megabits per second in major metropolitan areas. Deutsche Telekom, the German telco giant, already carries the iPhone in Germany.
iPhone users are notoriously loyal to the device and just as frustrated with AT&T for its congested network and dropped calls. AT&T has tried to manage the PR nightmare by pointing to its ongoing investment in upgrading the network that it said will total billions of dollars. Some tests have already shown improved performance in major cities in recent months, but the desire for another carrier other than AT&T remains.
Apple did not return a request for comment. A T-Mobile spokesperson said the company doesn't comment on rumors.
Analysts contacted by InternetNews.com were skeptical that Apple would pick a relatively also-ran partner.
"I know that that's been rumored, but I dont think it makes much sense. You've gotta go after the big boy Verizon. I think Apple is interested in identifying the market leaders and going with them. Maybe next year, but I think Verizon is the bigger fish to fry," said Brian Marshall of J.Gold Associates," told InternetNews.com. "It's been speculated on for several months because T-Mobile is a subsidiary of Deutsche Telekom and they sell the iPhone in Germany. Honestly, I would be shocked if that's what Apple did."
Gold, like Marshall, doesn't think T-Mobile could do much for Apple. "What is T-Mobile going to give them? I wouldnt think of T-Mobile as the first step in opening up the iPhone franchise in the country. Now if T-Mobile picks up Sprint and they merge as is rumored, that's another thing," he said.