Both Verizon, which announced first-quarter results on Monday, and Apple declined to comment about the iPhone talks. However, people familiar with the situation said Verizon had held talks with Apple about the possibility of selling an iPhone based on 3G wireless technology called CDMA 2000. Verizon owns 55 per cent of Verizon Wireless, the leading US mobile operator. Vodafone, the UK-based mobile operator, owns the remaining 45 per cent. If Verizon Wireless were to secure an iPhone deal, it would be a significant coup. AT&T, the second-largest US mobile operator, currently has an exclusive sales deal for the iPhone, using a different wireless technology. Industry analysts said they believed Apple’s deal with AT&T expires next year. It could enable Apple to reach iPhone sales agreements with Verizon and AT&T that would run in tandem. Denny Strigl, president of Verizon Communications, said the company was always open to discussions with suppliers when asked about the possibility of an iPhone deal on Monday.

“We have no announcements to make today, relative to Apple,” he said during a conference call with analysts about the first-quarter results. “Historically, we have not been dependent upon one device.” A deal with Verizon could mark something of a technology departure for Apple, which has so far only made iPhones based on 3G wireless technology called HSPA.

CDMA 2000 is a much less popular 3G technology than HSPA, although it is used by several mobile operators. Moreover, Verizon’s technology choices are starting to align with mobile operators that use HSPA. Verizon is planning to use 4G wireless technology called LTE, which is expected to be adopted by mobile operators that currently rely on HSPA. Verizon Wireless signed up 1.3m new mobile customers in the first quarter, bringing its subscriber total to 86.6m. The mobile group’s operating margin was 28.2 per cent in the three months to March 31, compared with 27.9 per cent in the same period last year, in spite of rising competition, notably from AT&T.

Verizon Communications recorded net income of $3.2bn in the first quarter, up from $3.1bn in the same period last year.

(taken from The Financial Times Limited 2009)