Verizon Wireless iPhone sales mostly online

BASKING RIDGE, NJ Fri Feb 25, 2011 9:29pm EST

Related Topics

BASKING RIDGE, NJ (Reuters) - Verizon Wireless sold more iPhones online than in stores, its top executive told Reuters, disputing a concern that the sparse crowds that greeted the store launch of the Apple Inc device signaled low sales.

Chief Executive Daniel Mead said in an interview at the company's New Jersey headquarters that demand for the phone has been at record levels since Verizon Wireless began selling the phone on its website February 3.

Mead told Reuters that the lack of long lines outside Verizon Wireless stores on February 10, the day it hit store shelves, could be attributed to the fact that about 60 percent of the company's iPhone sales were made on its website.

The executive said the device had helped substantially increase the rate at which customers switched to Verizon Wireless from all its other U.S. rivals.

At peak sales times Mead said iPhone brought 100 times more orders than usual to its website but he did not give specific numbers.

Mead reaffirmed the company's guidance that it would sell as many as 11 million iPhones in 2011. He said the company would give specific iPhone sales figures when it reports first-quarter earnings.

"This is the largest retail launch we've seen," the executive said. "When I look over the last three weeks or so it (sold) much more than we've seen in any previous device."

Verizon's iPhone launch ended AT&T Inc's more than three years of exclusive U.S. rights to sell the device.

AT&T was plagued with complaints about its network's performance due to the strain of additional data traffic from iPhone users. Verizon said its network was performing well despite additional data traffic from iPhone.

However, Verizon Wireless has not been immune to iPhone reception problems caused by the phone's antenna, according to Consumer Reports. The influential nonprofit organization, which publishes guides on everything from cars to TVs, said on Friday that holding the Verizon iPhone "in a specific but quite natural way" can cause the phone to drop calls.

But Mead said the company's dropped call rate for iPhones was only 0.5 percent.

In a separate interview on Friday, Verizon Wireless vice president for network planning Nicola Palmer said the company had been preparing for the device for more than a year.

This involved sending Verizon Wireless engineers out to Apple's California headquarters as often as once a week during that period, the executive said.

She said the company was seeing data usage rates from the iPhone similar to those of Verizon customers who use phones that run on Google Inc's Android software.

Palmer declined to say when Verizon would get an iPhone on its new high-speed network, which is based on a technology known as Long-Term Evolution. (LTE) But she said the company would bring out more Apple products.

"I fully anticipate we'll be working on more things down the road (with Apple)," Palmer said. "It's a partnership ... we'll continue to develop it."

Verizon Wireless is a joint venture of Verizon Communications Inc and Vodafone Group Plc.

Shares in Verizon Communications ended the day up 1.1 percent at $35.97, and held steady in after-hours trading.

(Reporting by Sinead Carew; Editing by Richard Chang and Carol Bishopric)

FILED UNDER: