Verizon posts strong earnings ahead of iPhone launch

25.01.2011
If carriers were like sports teams, Verizon could be described as having a lot of momentum heading into its showdown with AT&T.

Although Verizon's 2010 earnings were not as strong as 2009, the carrier did finish the year with a bullish fourth quarter that saw it add 872,000 postpaid subscribers to go with net income of $4.65 billion, nearly double the $2.37 billion reported in Q4 2009. On the year, Verizon posted a net income of $10.2 billion, or roughly 12% less than the $11.6 billion reported in 2009.

In addition to solid earnings, Verizon's fourth-quarter report also highlighted the increase in investments it has been making in wireless. The company invested $8.4 billion in wireless capital expenditures in 2010, compared to $7.3 billion for wireline. In 2009, the company invested more money in wireline ($8.9 billion) than wireless ($7.15 billion).

LTE IN 2011:

Verizon's strong fourth-quarter earnings come at a time when the company has made two significant moves over the past six months. In December, the carrier commercially launched its 4G LTE network, becoming the first major carrier in the United States to offer LTE services. And earlier this month, Verizon announced that it would soon support a CDMA version of 's popular iPhone 4 on its 3G EV-DO Rev. A network.

A conducted by ChangeWave suggested that Verizon could peel off a significant number of customers from AT&T once its iPhone is fully operational, as 16% of AT&T iPhone users said they wanted to switch to Verizon. Verizon is enticing iPhone users to switch by offering unlimited 3G data connectivity even as AT&T has enacted data caps for its 3G iPhone plans. Verizon's CDMA network does face limitations that don't exist on AT&T's GSM network, however, such as the inability to support simultaneous voice and data use.