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Digital Life

Verizon Exec's Comments Suggest Q4 iPhone Release

Verizon Exec
July 20, 2012 10:37AM

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Wireless analyst Gerry Purdy believes the next iPhone will be differentiated in several ways from the 4S: a bigger screen size, LTE data speed compatibility and an improved camera. And, as the first iPhone designed after the death of Apple co-founder and CEO Steve Jobs last year, Purdy suspects the iPhone will feature a tribute of some sort to Jobs.

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Looks like the tradition of new iPhones every summer may be a thing of the past. For the second year, June has come and gone without a new smartphone from Apple, and it appears likely the sixth model won't be a back-to-school accessory this year. After four June releases, Apple last year released the CDMA-capable iPhone 4 for Verizon in January followed by the upgraded 4S in October.

Feeding the Rumor Mill

Speculation was intense that the next model would come in the fall, and Apple as usual is playing its cards close to the vest. But comments from Verizon Wireless CFO Fran Shammo in a second-quarter earnings call have now largely dashed hopes for the new iPhone in the near future.

In discussing phone sales in the second quarter, during which Verizon sold 2.9 million branded Droid smartphones and 2.7 million iPhones, Shammo, according to published reports, cited "the rumor mill out there with a new phone coming out there in the fourth quarter, so people may be waiting."

Apple did not respond to our e-mailed request for comment at press time.

Shammo may have simply been referencing the power of rumors to affect sales rather than tipping his hat. And he didn't mention a specific phone. But it's the iPhone that has a proven track record for affecting buying patterns.

"It happened with the iPhone 4S," said wireless analyst Gerry Purdy of MobileTrax. "There was a multimillion-dollar drop in sales before the 4S came out in October. If you are in the store and someone says the iPhone 5 is going to be out in two weeks, you are going to say, 'Why am I spending my money now?' "

Purdy said a later time frame makes sense because Apple needs to wind down production of the 4S, which came later than usual, and wind up production of the new model without ending up with surplus components.

Purdy believes the next iPhone will be differentiated in several important ways from the 4S: a bigger screen size, long-term evolution data speed compatibility and an improved camera.

And, as the first iPhone designed after the death of Apple co-founder and CEO Steve Jobs last year, Purdy suspects it will feature a tribute of some sort, along the lines of the signatures of the designers of the original Macintosh computer that Jobs had engraved on the inside of the case in 1982.

'I hypothesize that they may want to give some recognition to Steve Jobs," who spearheaded the vastly successful iPhone project, Purdy said.

LTE Networks Maturing

LTE capability is a near certainty, Purdy said, which could explain why Apple is taking its time with the new model as Verizon and AT&T build out their high-speed 4G networks and Sprint Nextel launches its own. "They're waiting for networks to be more mature," Purdy said.

That could present a drawback for T-Mobile, if the smallest national carrier reaches a distribution deal with Apple, since it won't begin LTE until next year. That means LTE-equipped iPhones would initially connect at slower data speeds for T-Mobile customers.

An Apple employee recruitment video recently contained a reference to a bigger iPhone, which fuels speculation that Apple will finally give up the 3.7-inch display for a size that rivals competitors' screens.

"A bigger display makes a lot of sense and they can say, 'Look we made it thinner,' so the battery life won't be affected," Purdy said.

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