TheStreet.com wrote that Verizon (NYSE: VZ) will launch an "iPhone Killer" later this summer to stem the momentum that Apple (NASDAQ: AAPL) has already built in the market place for its iPhone. The iPhone has yet to sell one unit and already the competition is heating up.
Apple has conservatively modeled for the iPhone sales and has not let Wall Street analysts get ahead of themselves. Good strategic move, setting up Apple to under-promise and hopefully over-deliver. This has been its modus operandi since the popular iPod took off in late 2003-early 2004. But behind the scenes, several other cell phone manufacturers and carriers have been nervous and fretting about iPhone's potential ability to captivate the market. The iPhone could also raise the bar on overall performance expectations and more importantly, upset the fragile pricing structures in the industry. More bells and whistles and prices eventually coming down dramatically.
Verizon is allegedly ready to launch the "Prada" version of its own chic phone this summer. The endgame, of course, is to avoid losing customers to AT&T (NYSE: T), which currently has an exclusive with Apple. Verizon will pull-out all the stops necessary with a heavy marketing spend to attempt to slow Apple's huge momentum.
From a numbers point of view, Apple is sitting in the catbird seat, having modeled for 10 million units to be sold by end of 2008. This would represent just about 1% share of the handheld market . Apple could far exceed those estimates as the "viral" effects of the iPhone hit the market. The same I-gotta-have-one factor that propelled the iPod tidal wave.
The summer of 2007 should be most fascinating to watch as these new devices swarm an already anticipating audience. Let the games begin...
Georges Yared is the CIO of Yared Investment Research where he explores more growth stock ideas.











Reader Comments (Page 1 of 1)
5-24-2007 @ 10:05AM
Mike said...
Here come the haters again. The iphone will be far superior to the prada. There still is no ipod killer. Nice try verizon but you always lose out to the iphone.
5-24-2007 @ 10:40AM
Philip V Hastings said...
Okay - in case you guys haven't noticed.
Apple builds things that are cool for like, five years and work flawlessly.
Everyone builds crap that returns higher profit margins and breaks after three months.
Hmm...
5-24-2007 @ 11:39AM
Phuc Vu said...
Seeing as the following are true:
1. LG has been in the cellular game much longer than Apple and knows how to build a great and lasting product.
2. LG Prada has been around LONGER and WAS copied by Apple.
3. Apple does build quality items, but rumors of battery life being around 2yrs and you can't change out the battery yourself makes it a month long headache for those who need their cellular device because it's their only phone.
4. VZW is the #1 cellular company when it comes to call clarity and reliability. ATT rather spend your money on tech-gadgets than spending it on the network.
I love the iPhone and Prada. They both fill in a nitch where so many people are... those looking to carry less technology, less media players and more organization. But if they both were on the VZW network (like I am), I would choose the Prada simply because of the LG heritage.
5-24-2007 @ 12:41PM
Dave S said...
I don't see how the iPhone and the Prada are in the same league. Yes, the Prada looks incredible, but Apple's products are about more than looks - the iPhone's design intention is to provide a more complete communications experience than today's mobile phones.
The Prada is just a gorgeous phone. Or I'm missing something (which has happened before so don't flame me out).
5-24-2007 @ 1:15PM
gumby said...
Sure and be careful not to lose your iPhone.
Nokia, erickson , motorola and others will come up with thinner slicker "iPhones" and cream Apple to oatmeal
5-24-2007 @ 7:19PM
Lun E'sex said...
What this article leaves out is the expected PRICE of the LG Prada phone: It *starts* at 600 euros. At current exchange rates that's over $800 U.S.
There's no mention anywhere (here, the official Prada phone site, Wikipedia, etc.) of how much memory it has, either. I would guess that it's significantly less than the 4GB or 8GB that's going to come in the iPhone. (Otherwise they'd advertise it.)
I also don't see anyone complaining that the Prada phone isn't a 3G phone either (it's also only Tr-band, rather than Quad-band), which is one of the reasons people like to rake the iPhone over the coals.
5-25-2007 @ 11:19AM
joey said...
I dont know about apple building items that last 5 years. I go through a new pro laptop every 3 years and as for the ipod about every two except for the newest flash based ipods those seem to me more durable and of better quality. I am not trying to bash apple as I have many or there products and they work almost flawlessly but there shelf life sucks...
6-01-2007 @ 12:34AM
JJ said...
Speaking of Verizen Wireless, I have a home in St Petersburg, Fl and a camphouse in Rockport Texas.
I purchased my Verizen Cell phones and service in Rockport over 3 years ago. IMHO Verizen service sucks. Their cell service in both places is almost non-existant at best. When I try to get Verizen to fix the problem they want me to upgrade my phones software. Soft ware is NOT the problem, signal strengh is! when I stand in my own front yard and try to use my cell phones I do not even get one bar. BUT if I walk down to the end of the block I can make calls but who wants to stand out in the heat, rain, wind, just to make a call. This has been going on for three years now and Verizen has not make one move to rectify the situation. Last year we went to Quartzsite Arizona for the winter. We stayed about 3 miles south of I10 and about 3 miles east of Az 95 on the BLM land for about 4 months. Verizen service was excellant. I wonder why Verizen can not give the same servie in a major city like St Petersburg Florida or a coastal town like Rockport Texas?
Then they want to kill the competition from Vonage. Why when Vonage is taking care of their customers where Verizen does not !!!
6-02-2007 @ 4:32PM
remav said...
Fact: Apple asked Verizon Wireless to carry the iPhone 1st. (I guess they know which network is the best!) Apple's demands over control of the iPhone's marketing left VZW with little choice than to respectfully decline the "offer".
Fact: Verizon's broadband service is superior to Cingular's (aka, "Single Bar" aka AT&T) service. This means that a smaller local storage medium is not nearly as important. You can download huge chunks of music or video easily.
Fact: the $800 price of the prada mentioned above is absurd. It's full retail price is right in line with the iPhone's $500/$600 BEFORE the normally huge discounts.
Fact: Cell phones are usually treated pretty poorly and they survive. iPods are pampered continiously or they end up looking like $H!T very quickly!
Fact: The Prada will be able to "listen" to a song being played and then identify it & offer up the MP3 to the customer... in a ubiquitous MP3 format. iPhone will rely heavily on iTune's proprietary nature.
The error in the Apple crowd's logic is that they belive iTunes/iPod to be equavalent to Microsoft/Windows where nothing works unless it's on their system. Sorry, this is not an OS. It's a "player". And MP3 players are getting to be as cheap as pencils. It's much harder to design an excellent phone.
Sorry Apple, anything you can do Verizon Wireless will be able to do better. Enjoy your loyal band of sheeple while you have them.
1 more parting shot... Q: what is the most common thing an ATT customer says to a Verizon Wireless customer? A: Can I borrow your phone, mine doesn't work here! (especially after a hurricane!)
6-18-2007 @ 9:00AM
Okay K K said...
I have not even seen the Prada yet, will google in a minute if anyone has any links please post. All I know is that I just got my 8125 stolen needless to say At&T does not insure PDA/Smartphones so I am going to Verizon they do. Also, the price that I paid to utilize my PDA to its full capacity (emails, internet etc..) after a discount is the starting price at Verizon and everyone I know is switching to verizon because the network is better.
6-18-2007 @ 2:08PM
Javelin7 said...
The prada looks hotter than the iphone. Iphone has much more than the prada....or does it? For all we know, Verizon might throw some gigs and internet in the Prada before it releases. That way it can take down the iphone with cheap pricing ($300-$400). It's going to be Wii and 360 all over again. 360 come out early and now is loosing money(iphone) and the wii is godly(Prada; other touchscreen phone in the near future.)
6-22-2007 @ 9:19AM
patrick m said...
The iphone is just one last hurra- for apple. everyone keeps saying apple is trying to make a phone that is a complete communications phone... BS.. they obviously went to verizon first because the are the # 1 cellular provider.. and verizon declined respectfully due to the fact that apple wants too much control. it's completely obvious they just want money.. all their products are over-priced and mostly sell due to not performance but "fad" . i mean come on they opened their own stores not to be convienient but so they didn't have to cut costs to other distributors. they could make the most money selling out of their own stores.. they're both nice phones but i'd rather have a qwerty it's easier to use and doesn't get all smudged and dirty.. like i said it's all a fad!