I recently shared my thoughts on why the iPhone isn’t on Verizon. One of the major reasons is because the iPhone isn’t currently designed with hardware that is compatible with the Verizon network. A Verizon iPhone may not be likely in the near future, but the Kaufman Bros advisory firm believes that the time for a T-Mobile iPhone is drawing nearer.
Unlike Verizon, T-Mobile uses the same GSM technology as AT&T, which means that existing iPhones are already compatible with the network. In fact, many people have already circumvented the iPhone’s default AT&T lock-in and instead opt to use the iPhone on T-Mobile, though this is not officially supported or condoned by Apple or AT&T.
Citing this existing compatibility, a recent report from the Kaufman Bros. asserts that T-Mobile is the most likely†candidate to be an eventual secondary carrier for the iPhone. The report also suggests that a good reason for Apple to be considering a secondary carrier is to prevent the continued increase of phones running Google’s Android operating system, which have been an attractive smartphone alternative to consumers who aren’t on AT&T.
While I agree that T-Mobile would be a more likely alternative than Verizon with Apple now having years of experience (and devices that are already compatible) with the GSM technology I can’t quite agree with the time frame that the report is predicting. The report indicates that Apple may be …open to add U.S. carriers in 2011.†However, Apple is in an iPhone exclusivity agreement with AT&T which extends until 2012.
With Apple’s shares currently trading higher than ever before, there doesn’t seem to be any major reason why Apple would want to restructure it’s contract with AT&T and risk losing out on the subsidies that make the iPhone affordable for AT&T customers — not to mention other perks that go along with the partnership. If Apple originally launched on T-Mobile (the 4th largest carrier in the US) and wanted to begin offering the iPhone on AT&T (the 2nd largest), that would be a bit more logical. I’m no analyst, but it doesn’t seem to make strategic sense to give up the benefits of exclusivity in order to launch the iPhone on a carrier which has a much smaller customer base than the carrier which currently offers the phone.