Phones

Verizon IPhone 4 Debut: The Big Fizzle

The Apple Store in Walnut Creek, Calif., a shopping mecca 30 miles east of San Francisco, seemed overstaffed today, as employees served only a handful of customers. There were no lines. In fact, no one was even milling around the Verizon iPhone table. Three employees rushed me as I entered.

Across the country, few lines formed at Apple Stores.Only eight people were waiting at Apple's flagship store in New York just before it opened, according to CNNMoney. Early reports blamed the chilly weather. In Walnut Creek, though, the sun was shining.

But today was the long-awaited launch of the Verizon iPhone 4. Pre-orders available to existing Verizon customers sold out last week in a matter of hours, although Verizon declined to quantify the number of pre-orders. Either way, today was supposed to be another Apple bonanza at its stores.

So why the bust?

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To be fair, we won't know if it's a bust until Verizon tallies the units sold. But rest assured that both Apple and Verizon expected customers storming the front doors. Steve Jobs can't be pleased. Apple is known for long lines and excited customers, but today the prevailing image is a bunch of Apple employees in blue shirts standing around with nothing to do.

My guess is that Verizon overplayed its hand, thinking wannabe iPhone customers would fall for anything. First, there was the long wait. Rumors of a Verizon iPhone seemed to surface every quarter for years, thus stringing iPhone hopefuls and AT&T bashers along. At some point, a backlash is inevitable.

Then Verizon chose to come out with an iPhone in February, after the 30-day return policy expired on phones bought during the holiday season. If a Verizon iPhone had come out in January, many Verizon customers might have returned their Christmas phones for iPhones, leaving Verizon stuck with crushing inventory. By coming out in February, Verizon appeared to be pulling a fast one on customers.

(Verizon did offer iPhone credit for returned phones in a convoluted special program: If you bought a Verizon phone between November 26, 2010 and January 10, 2011, you can receive a Visa debit card for up to $200 when purchasing an iPhone 4 at the full price of either $599 for the 16GB model or $699 for the 32GB model.)

My colleague, Al Sacco, correctly points out that the iPhone 4 has been around for almost eight months (albeit on AT&T's spotty network) yet costs the same today on Verizon. Even worse, the iPhone 5 is expected to come out this summer. These are just some of his reasons not to buy a Verizon iPhone 4.

"It would be a wise move for most folks to hold off on signing a two-year Verizon contract for the iPhone 4," Sacco writes. "The iPhone 5 will surely pack a variety of cool new features and functionality that'll leave many iPhone 4 users craving for more."

For the record, I don't agree with Sacco's conclusions. The iPhone 5 likely won't have ground-breaking advancements. Gadget geek Kyle Wiens of iFixit expects to see dual core and more RAM in the iPhone 5 but no significant improvements on the camera and Retina display. (See iPad 2 and iPhone 5: What's Coming?)

However, Wiens did take apart a Verizon iPhone 4 and found that Apple is using the same Qualcomm chip as the Droid Pro, or "world phone." This chipset supports both GSM and CDMA, which means that Apple could have supported GSM, he says. "This is a sign that Apple may be considering unifying the CDMA and GSM iPhones in the future."

That's good news for globetrotters. For the rest of us, it's not such a big deal.

But the timing of the Verizon iPhone 4 coming out only a few months from the expected iPhone 5 likely put off many potential buyers. Never mind that existing iPhone 4 owners on AT&T will only be a year into their two-year contracts by the time the iPhone 5 hits Apple stores. Chances are they'll be out of the iPhone 5 market, too.

All of this will be moot, of course, if Verizon reports huge numbers of iPhones sold this quarter. At least today, though, there's no doubt that AT&T execs are grinning.

Tom Kaneshige covers Apple and Networking for CIO.com. Follow Tom on Twitter @kaneshige. Follow everything from CIO.com on Twitter @CIOonline. Email Tom at tkaneshige@cio.com.

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