Did Sour Grapes Prompt Verizon’s Apple Attack?

In the past few weeks,  Verizon Wireless has fired a pair of loaded torpedoes at rival AT&T—and more notably Apple, a company often viewed as a sacred cow in both the marketing and technology spheres.

Telecom experts say that such an Apple offensive is long overdue, though not without risk. Still, most observers doubt that Verizon’s attacking posture indicates that the company has given up on the ultimate prize—being able to offer Apple’s iPhone on its network once AT&T’s exclusive contract expires.

To review: First, there was McCann Erickson’s Verizon spot which carried the tagline, “There’s a map for that,” simultaneously tweaking Apple’s ubiquitous “There’s an app for that” message while pounding on AT&T’s weak 3G coverage. Then came a set of teaser ads promoting Droid, a would-be iPhone killer that Verizon is offering via onetime Apple partner Motorola. Those spots, produced by new Verizon agency mcgarrybowen, directly (though subtly) take shots at the iPhone itself. During the spots, without ever naming the iPhone, several of the device’s supposed flaws are listed in a series of iDon’ts such as “iDon’t have a real keyboard” and “iDon’t take pictures in the dark.”

So far, both Verizon and AT&T have been quiet about this new claims war (both declined to comment for this story). But the two companies have had dustups in the past, as each has brought at least one complaint to the National Advertising Division in the past two years.

Regardless of the fallout, it appears that Apple’s smartphone honeymoon may be over. “Frankly, it’s taken a lot longer than I thought to react to and market against the iPhone,” said Jeff Kagan, an Atlanta-based telecom analyst. “When the iPhone came out, it rocked the industry. You had a noncell phone company making a cell phone. It really energized the whole space, and we saw a lot of me toos. But we haven’t seen anybody attack the No. 1 player.”

Number one with a bullet. Last week Apple rocked Wall Street when it announced 47 percent profit growth during its most recent quarter. Thus, some maintain that carriers can’t stand pat and wait for their own iPhone deals to happen. And obviously handset manufacturers can’t let iPhone run away with the market. “Frankly, rivals can’t afford not to [go after Apple],” said Vincent Nguyen, editor/co-founder of the tech and gadget enthusiast site SlashGear.com. “After another quarter of incredible financial results, Apple has once again demonstrated that it holds the key not only to maintaining consumer interest but also, even in the midst of a recession, getting them to open up their wallets. For a rival, if raising your profile takes you even a quarter percentage point higher in sales, that’s got to be worth it.”

In the case of the Droid, which arrives in November, Motorola better deliver on that buzz.

“This strategy can work quite well if you have a device that is truly better than the iPhone,” said Roger Entner, senior vp, research and insights, Nielsen Telecom. “As long as you can back it up. If not, you lose a lot of credibility.”

With these spots, isn’t Verizon also opening itself up to Apple CEO Steve Job’s ire, and risking its future iPhone deal? That’s doubtful, said most observers.

Kagan believes these ads are more about hammering AT&T in the short term—and planting the idea in consumers’ heads that the iPhone would be even better on Verizon’s network. “It’s about setting up the marketplace for today and laying the groundwork for tomorrow,” he said.



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