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The Pros and Cons of the new iPhone 4 from Verizon

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It took a while, but AT&T finally has some competition here in America when it comes to offering service plans for the Apple iPhone 4. As of February 10, 2011, Verizon has begun offering the iPhone 4. Thus, consumers now have a choice of service providers. Jason Rich explores what's being offered by Verizon, as well as some of the pros and cons of activating a new iPhone 4 with Verizon instead of AT&T Wireless.

After years of speculation and anticipation, on February 10, 2011, Verizon officially began offering the Apple iPhone 4 on its U.S.–based 3G wireless network. On that day, Verizon opened its more than 2,000 retail locations to deal with what the company expected to be significant crowds looking to acquire an iPhone 4 with Verizon wireless service. The iPhone 4 from Verizon also is now available at all Apple Store and Best Buy locations, at select Wal-Mart stores, and at the Verizon and Apple websites.

On February 3, 2011, Verizon began taking iPhone 4 pre-orders on its website, but due to overwhelming demand, which the company reported as its "most successful first day sales in the history of the company," it ceased accepting pre-orders by 8:10 pm (EST). Ultimately, within a month, Verizon reports it has sold more than one million iPhone 4 units.

Of course, virtually identical iPhone 4s continue to be readily available with AT&T Wireless service plans through Apple and all authorized AT&T Wireless sales agents.

Who, you might be wondering, are all of these people looking to be among the first to have an iPhone 4 with Verizon service? Some are existing Verizon customers who plan to upgrade their existing non-iPhone device to an iPhone 4. Others are customers of other service providers who want an iPhone, but didn't want to switch to AT&T Wireless. Some are current AT&T Wireless customers looking to get away from their current service provider.

As you'd expect, Verizon is offering a somewhat lenient upgrade program for existing Verizon customers who are in the middle of a two-year service contract and who aren't otherwise qualified for a phone upgrade. This is through the company's existing phone Trade-In Program, which allows customers to trade in any existing cell phone or Smartphone for credit toward a new iPhone 4.

Existing customers who aren't eligible for a phone upgrade will need to purchase the iPhone 4 at the full retail price ($649.99 for the 16GB model or $749.99 for the 32GB model), as opposed to the discounted price available to customers who are able to sign a new (or renewed) two-year service agreement.

New Verizon customers and those eligible for a phone upgrade can acquire the iPhone 4 with Verizon service for $199.00 for the 16GB model or $299.00 for the 32GB model. A new two-year service contract that has an early termination fee up to $350.00 is required.

If you're planning to make the switch from using an iPhone 3Gs or iPhone 4 with AT&T Wireless to use Verizon, you'll need to purchase a new iPhone 4. While all iPhone 4s operate using Apple's iOS operating system and are compatible with all the same apps (more than 400,000 of them), iPhones for AT&T and Verizon are configured differently and are not interchangeable.

For the thousands of people buying and activating a new iPhone each month, they have two main decisions. First, they need to decide which model iPhone to purchase, based on how much memory they want or need within the device (they are not upgradable after the fact). Second, new iPhone users need to decide which service provider to activate the phone with (AT&T Wireless or Verizon).

As of March 2011, both AT&T Wireless and Verizon are offering similarly priced service plans, but with slight variations. Both require a two-year commitment, and both providers divide the iPhone service plan into three separately priced components[md]voice calls, text messaging and wireless Web access (also referred to as the data plan).

While the voice components of the service plans are comparably priced, there are slight (albeit somewhat insignificant) differences in the price of the texting plans between the two service providers. The biggest difference between AT&T Wireless and Verizon is currently related to the available data plans.

For a flat monthly fee of $29.00, Verizon is offering an unlimited data plan for the iPhone 4 (that does not include tethering); AT&T Wireless no longer offers such a plan, but instead offers three separate data plans, each with a monthly usage limit.

For example, AT&T Wireless offers a 200MB plan for $15.00 per month (with each additional 200MB block of data usage available for $15.00 each), a 2GB plan for $25.00 per month (with each additional 1GB priced at $10.00), and a 2GB + Tethering plan for $45.00 per month (with each additional 1GB priced at $10.00).

As of March 11th, both AT&T Wireless and Verizon will begin offering a feature called tethering, which allows the iPhone to create a personal Wi-Fi hotspot, allowing up to five Wi-Fi–enabled devices (such as a iMac, MacBook, iPad, iPod Touch or digital camera) to access the 3G wireless web simultaneously from a connection created and maintained by the iPhone.

To utilize this feature, AT&T Wireless users will need to purchase the 2GB + Tethering data plan ($49.99), while Verizon users will need to sign up for the "Unlimited on iPhone, 2GB on 3G Mobile Hotspot" data plan for $49.99 per month.

This Verizon plan includes unlimited 3G web access via the iPhone 4 itself, and up to 2GB per month, which can be used for tethering other devices. Each additional 1GB used as part of a 3G Mobile Hotspot will cost $20.00.

Another significant difference between AT&T Wireless and Verizon is the capability to use the iPhone 4 overseas. Both services offer costly international roaming. However, an AT&T Wireless iPhone 4 will seamlessly work in more than 200 countries, whereas Verizon iPhones will work in only about 40 countries.

While you may not travel too much overseas, when choosing between AT&T Wireless and Verizon, the trick is to select the company that offers the best 3G overage in the city or cities where you will most often use the phone.

While both companies offer decent 3G coverage in most major U.S. cities, if you live, work, or travel to the outskirts of cities, 3G coverage might not be readily available, and trying to use the iPhone 4's web surfing capabilities with a slower wireless connection is tedious at best.

Thus, it becomes important to evaluate which company offers the best 3G coverage in areas or regions that are relevant to you, and understand that offering standard wireless coverage and 3G coverage are two separate things.

Keep in mind that as competition heats up between AT&T Wireless and Verizon, new price plans and promotions will be announced. For example, just after Verizon started offering the iPhone, AT&T Wireless had a short-lived promotion that awarded several thousand free rollover minutes to existing customers, in hopes of keeping them to jumping ship and heading to Verizon.

Furthermore, don't get caught up in hype being generated about either company's 4G wireless network because the current iPhone 4 models are not compatible with the latest 4G wireless networks. You'll eventually need to upgrade to an iPhone 5 to access these much faster wireless networks that are first starting to be introduced here in America.

Since the release of the iPhone, AT&T customers in many cities have complained that the existing 3G network isn't large enough to meet the demand, resulting in dropped calls and the inability to access the wireless web or send/receive text message during peak times in some cities. Other users in other areas have had a problem-free experience using their iPhone with AT&T's network.

AT&T Wireless has acknowledged capacity problems in certain cities. It's too soon to tell, however, if the onslaught of new iPhone subscribers on Verizon's 3G network will have the same negative impact.

Another difference between AT&T Wireless and Verizon iPhone service is that with Verizon, it is not currently possible to talk on the phone and access the wireless web simultaneously, which is a useful feature that AT&T Wireless does offer.

Yes, it's exciting that Verizon is now offering the iPhone and will be providing head-to-head competition with AT&T. Hopefully, this will result in more competitive pricing for service plans and nationwide upgrades for both existing 3G networks to allow for clearer and faster connections.

Right now, however, you'll need to pick a service provider based on what's currently offered, and understand that you're making a two-year commitment. It's also extremely likely that the iPhone 5 will be introduced sometime within the next year, meaning a hardware upgrade will be required regardless of which service provider you opt to sign with today.

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