Verizon needs Verizon iPhone more than Apple, after Droid debacle

Three years of talking about a Verizon iPhone, and still nothing to show for it. What we have instead are two facts that are sharply at odds with each other: Verizon customers want a Verizon iPhone, if their continual cries of the past three years are to be believed. And Apple is selling such an overwhelming number of iPhones to the point of extended delays and backorders, even with the limitation of continued AT&T exclusivity, that there wouldn’t be enough iPhone 4 inventory to hypothetically share with Verizon customers anyway. Apple can likely get out of its exclusive AT&T deal any time it wants just to by writing a large enough check, but that still offers no clue as to just when it might finally happen. But if you heard a loud thud off in the distance this week, it was the hopes and aspirations of the competing Android platform, in which Verizon has invested heavily with its Droid and Droid X, coming crashing down into what will apparently soon be a mere pile of rubble. As reported by CNN this week, a Yankee Group study reveals that an astounding four out of five current Android users have no plans to buy another Android phone. And that’s game over.

While Google’s own Android-based Nexus One phone has been canceled due to lack of interest, Verizon’s Android-based Droid has been selling quite well (though not nearly as well the platform’s most overenthusiastic users would like you to believe). But it doesn’t matter how many units you’re selling or how many new customers you’re acquiring if eighty percent of them are so dissatisfied with the platform that they’re already plotting their escape. It’s too soon to predict how many of the Android escapees will end up landing on the iPhone, but what is clear is that most Verizon customers who bought a Droid did so because they wanted an iPhone but weren’t willing to switch to AT&T, and so they settled for the closest thing to an iPhone they could get their hands on. Apparently not close enough, however, as the Android has now been revealed to be the fastest-sinking technology platform since, well maybe, ever.

But if the situation is so obviously dire that external temperature takers can now figure out that most Android users are looking to bail out of the platform when they buy their next phone, then it’s a safe bet that Verizon has already known this for at least a little while. So even as the carrier is dumping inordinate amounts of money in launching its new Droid X phone (and selling plenty of them, to be fair), Verizon likely has its left eye focused on endings the longstanding impasse with Apple and getting its hands on the iPhone to ensure that all these dissatisfied Android users don’t also leave Verizon when they leave the Android platform. In other words, Verizon now needs a Verizon iPhone more than Apple needs a Verizon iPhone. After all, that same CNN report shows that four out of five iPhone users plan to remain with the iPhone, the exact opposite scenario being faced by makers of Android-based phones. The question then becomes what kind of concessions Verizon is willing to make in order to get its hands on the iPhone sooner rather than later. After all, unlike Apple, whose cellular presence lives and dies with the iPhone itself, Verizon’s primary priority is in ensuring that its current customers remain with the carrier; which particular phone they end up buying is secondary to the fact that they simply stay with Verizon.

Not only do we now know that the Android platform is a sinking ship, we also know that Verizon knows it, and perhaps most importantly, Apple now knows that Verizon knows it. The timetable for a Verizon iPhone is still anybody’s guess, but with most current Droid users presumably ending up with an iPhone when it’s all said and done, look for Verizon to try to make a Verizon iPhone happen as soon as possible – and with Apple’s known penchant for driving a hard bargain with potential partners, expect Verizon to be in a much weaker bargaining position than the Droid’s cheerleaders might expect. Here’s more on the Verizon iPhone.