It is now being widely reported that Verizon Wireless had the first chance to be the exclusive distributor of Apple's iPhone in the United States. According to Verizon Wireless vice president Jim Gerace, Verizon Wireless was offered the partnership first, but simply "said no." Verizon explained that the two companies could not come to an agreement that was mutually beneficial.
The lack of agreement is reportedly due to Apple's steep demands in regards to the sales and service of the iPhone. One of the major sticking points was Apple's insistence that the iPhone be sold only at Apple and Verizon Wireless corporate stores. This presented Verizon with an issue that could not work with their major retailing partnerships with big-box outlets like Wal-Mart and Best Buy.
Verizon has gone so far as to state that "the iPhone product is something we are happy we aren't the first to market with," according to COO Denny Strigl. Instead, Verizon hopes to avoid the headaches Cingular will have to endure with such a massive and unique product launch, while reaping the benefits of the increased attention to the mobile music market.When news first broke that the iPhone was being released on Cingular, many industry faithfuls were shocked. Until recent launches of devices such as the Samsung Blackjack and nationwide launch/publicity for their 3G HSDPA/UMTS network, Cingular had been slowly developing a reputation for being behind the times in terms of wireless device technology. The news that Verizon was Apple's first choice may not come as a surprise to many. Spokespersons from Cingular and Apple, on the other hand, have indicated that "Apple chose Cingular because it's the best, most popular carrier in the United States" and that they "think this is a win for Apple, and it is a win for Cingular.
Amidst last week's rumors that Cingular will offer incentives for Verizon customers to recover early termination fees if they leave Verizon for Cingular (now being rebranded AT&T) and the iPhone, only time will tell if Verizon passed on a migraine or a goldmine.