Verizon iPhone Sales Disappoint - InformationWeek

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2/23/2011
12:09 AM
Ed Hansberry
Ed Hansberry
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Verizon iPhone Sales Disappoint

Despite record online sales for the Verizon iPhone, overall sales have been disappointing to those at Apple. Before you read too much into that though, there are a few things to consider.

Despite record online sales for the Verizon iPhone, overall sales have been disappointing to those at Apple. Before you read too much into that though, there are a few things to consider.According to Boy Genius Report, Sales at Verizon are higher on a per store bases for five Apple stores, but they aren't reflecting any pent-up demand. These were sales for the first five days of availability:

  • Thursday: Verizon = 909, AT&T = 539
  • Friday: Verizon = 916, AT&T = 680
  • Saturday: Verizon = 660, AT&T = 471
  • Sunday: Verizon = 796, AT&T = 701
  • Monday: Verizon = 711, AT&T = 618

The Verizon iPhone is clearly moving more than the AT&T model, but this doesn't reflect a market that has been waiting for this day for nearly four years. What is going on?

First of all, for the most part, if someone wanted an iPhone, they'd already have it, even though they might not be on the network of their choice. Even if they wanted to be on Verizon today, they likely have early termination fees (ETF) to contend with. The fee starts at $325 and goes down $10 for each month you are with AT&T. Chances are, people have a hundred or so dollars hanging over their head if they switch now. That is a lot of money to pick up an identical phone on a different network, especially in this economy.

Secondly, as Business Insider points out, this is a horrible time of the year to buy a new Apple product. With March just around the corner, we are only three to four months away from the iPhone 5 if Apple holds to the historical June/July release dates.

I think Verizon will siphon off AT&T iPhone users but due to the ETF, it could take 18 months or so before that cycles through. At that point, the phones should be identical and AT&T and Verizon will duke it out based on pricing and the quality and speed of the network.

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