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The Perfect Blend: Verizon Is Set To Start Selling The iPad On October 28
Early Thursday morning, Verizon Wireless announced that it will begin selling Apple's iPad at its 2,000 retail stores nationwide on Oct. 28. This announcement, ends AT&T's exclusive grip as the sole distributor for Apple's fanatically popular tablet, and sets the stage for a broader partnership between Apple and Verizon. To provide portfolio diversity, Verizon Wireless is planning on offering three iPad bundles, each featuring an iPad Wi-Fi model and a separate Verizon mobile hotspot device. The retail prices are expected to range from $630 for a 16 GB iPad to $830 for the 64 GB model. Those prices will match the cost of Apple's WiFi + 3G iPads, which currently comes with built-in 3G capabilities. Stand-alone, Wi-Fi only iPads -- which Verizon will also carry - will begin retailing at $500. While it is true that current AT&T iPad customers can already run their Wi-Fi iPads over non-AT&T networks (by using external devices), the Verizon partnership is unique. This partnership marks the first time that Apple has linked up to sell its devices with a U.S. wireless partner other than AT&T, and signals a change in Apple's marketing strategy. More importantly, many industry insiders believe that this partnership is the first of many between Apple and Verizon. In fact, many insiders believe that Verizon is working on bringing Apple's iPhone to its network in early 2011.
While the new partnership will provide customers with increased choice, the Verizon partnership also raises a number of important questions. From a technological standpoint, the battery on Verizon's mobile Wi-Fi device is expected to last only 4 hours, compared to the nine to 10 hours Apple estimates iPad users can get from their devices while surfing on Wi-Fi networks. And while Verizon's smartphone data plans offer unlimited data use, sadly, Verizon's iPad data plan will be capped. A monthly plan offering up to 1 GB of data is expected to cost an additional $20. This amount compares to $15 on AT&T for a 250 MB data plan, or $25 for a 2 GB plan. While this is one of a number of slight differences, the larger questions surround the impact that this partnership will have on price competition within the technology market. While AT&T was Apple's first iPad partner, the new partnership will significantly increase supply throughout the United States. Similarly, with other retailers including Wal-Mart, Best Buy, and Target set to carry a larger supply of iPads, this Christmas season could see an aggressive price war break out between competing iPad retailers. While the impact of this price war remains uncertain, the partnership between Verizon and Apple looks like an excellent decision, one that will likely translate into increased revenues, market share, and share value. In fact, many believe that this Christmas season could be one of Apple's best.