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TheStreet Open House

Apple Verizon iPhone Set for Holidays

CUPERTINO, Calif. ( TheStreet) -- Apple (AAPL - Get Report) has bumped up its iPhone production plans, which include a Verizon (VZ - Get Report) iPhone that will be available for the holidays.

Apple has asked its supply and manufacturing partners to prepare for a production rate of 4 million iPhones a month by September, a 25% increase, says Rodman Renshaw analyst Ashok Kumar, who has been monitoring the production plans in Asia.


The Mac maker has also told its manufacturing partner Asustek to plan on starting full-scale production of a CDMA version of the iPhone to be available at Verizon as early as November, Kumar says. The report is yet another confirmation of Apple's long-awaited Verizon iPhone, which still awaits final approval from the two companies that have not always seen eye-to-eye.

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If reports of the Verizon iPhone are true, Kumar estimates that Apple will be on track to exceed a production rate of 40 million for the year, which exceeds most analysts' expectations.

The big ramp up in iPhone manufacturing may be related to Apple's expected shift toward non-exclusive iPhone sales agreements in the U.S. and internationally. Initially, Apple debuted its iPhone with an exclusive partner in each country. But Kumar says Apple is now moving toward being what he calls a "carrier agnostic" approach. Under the plan, AT&T (T - Get Report) will continue to sell the iPhone, but other carriers would also have iPhones to sell.

Other observers say the production boost isn't a big surprise since Apple is expected to introduce a totally redesigned iPhone during its June 7 developers' conference. The arrival of a new design is likely to trigger a huge replacement cycle for iPhone owners eligible for upgrades and new two-year contracts.

The speculation around a Verizon iPhone has been unceasing for more than a year as Apple's ambitions to expand its iPhone empire make Verizon's 90 million customers an inevitable move.

Kumar warns that nothing is definite with the Verizon iPhone decision, which he says is ultimately in Apple chief Steve Jobs' hands.

--Written by Scott Moritz in New York

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