Citing unnamed sources, the Bloomberg news service said AT&T's exclusive right to sell the iPhone expires at year's end—opening the door for Verizon to provide an alternative for iPhone users who have become frustrated with spotty service on AT&T's network.
UBS AG analyst John Hodulik expects Verizon to sell about 12 million iPhones in its first year of offering the product. "Not only would they sell lots to their own base, they would also be able to attract new gross adds from other carriers," Hodulik told Bloomberg.
iPhone users in major cities like New York and San Francisco have long complained about dropped calls and slow speeds on AT&T's network, which is advertised as 3G but often falls short of that. Some have even sued the carrier, along with Apple, over the issues.
But AT&T can't be blamed for all of the problems with the iPhone. The most recent version, iPhone 4, is suffering from a glitch that appears to be the result of design problems that originated with Apple.
Many iPhone 4 buyers have reported that Apple's new smartphone drops its signal if the bottom left corner of the device is covered by the palm of the user's hand—a situation that's common when the phone is wielded by lefties.
A California-based law firm is now trolling for consumers upset with the performance of the iPhone 4, possibly with an eye to launching a class-action suit against Apple.
"If you recently purchased a new iPhone and have experienced poor reception quality, dropped calls and weak signals, we would like to hear from you," reads a note on a Web site maintained by Kershaw, Cutter & Ratinoff, of Sacramento.
iPhone 4 went on sale last week. The 16GB version is priced at $199, while its 32GB cousin goes for $299. A two-year AT&T service contract is required for purchase.