Verizon Wireless looks like it will get a larger boost from Apple’s new iPad than its rival wireless service vendor AT&T Inc, despite both the carriers being the first ones in the United States to start selling the tablet, which was launched on March 7.
Verizon Wireless is expected to sell anywhere between 3 million to maybe even 4 million iPads in 2012, while AT&T is expected to sell close to 2 million iPads in that same period. This is according to Mr. Kevin Smithen, who is an analyst with Macquarie Securities U.S.A. Inc. The new iPad has been designed such that it will be able to work on both the firms’ next gen wireless services. These networks are based on a new technology which is called LTE, or Long Term Evolution.
AT&T’s LTE network coverage is much less extensive and covers fewer customers than Verizon Wireless’ LTE network. Verizon also has a feature wherein customers can turn their iPads into mobile hotspots, a feature that is not available to AT&T customers as of now. As a result of this, Mr. Smithen reckons that Verizon subscribers might be able to make more use of their iPads than AT&T subscribers.
According to him, Verizon will definitely benefit more from the new iPad’s release and this release could result in significant growth for Verizon due to their coverage advantage over AT&T. Verizon Wireless’ LTE network covered around 200 million potential customers as of December 2011, the company reported in January. AT&T, in contrast, said in January that it could now reach 74 million customers with its LTE network.
James Ratcliffe, who is an analyst with Barclays Capital, wrote in a report published yesterday that in terms of competition, Verizon’s more extensive and larger foot print gives it a bit of a marketing advantage. Mr. Mark Siegel, who is a spokesperson for AT&T, said that any AT&T customers outside the LTE coverage area would still get fast internet speeds.
Many people who own the iPad 2 tend to use the tablet on free Wi-Fi networks at places like cafes, offices and homes to avoid expensive wireless service charges. That is expected to change soon as customers start using the variety of options that the iPad’s capabilities provide them with. Up to 30 percent of the purchasers of the new iPad are expected to buy it on carrier networks, which will be an increase from 20% for previous generation iPads.
