It's all good for Apple (AAPL).
Now, by "cheap" iPhone, I don't mean that inane rumor that Apple plans to make a smartphone out of plastic. I mean the "cheap" iPhone you can buy right now. The one for $199 online at your local Apple Store, via your friendly neighborhood wireless carrier or through an electronics store. The one that you think is "cheap" but in all reality is anything but.
We'll get to that in a second (and it's critically important because, again, I cut through the noise and hysteria on Apple here), but first ...When something happens with Apple, I usually bounce it off TheStreet's resident tech authority (and geek) Chris Ciaccia. Along with the numbers you need to know, Chris agrees -- what Verizon had to say bodes well for Apple:
Verizon activated 6.2 million iPhones during the quarter, half of which were the iPhone 5. This is slightly better than Wall Street was expecting, and the case can now be made for a 50 million+ iPhone quarter. Apple has increasingly become a seasonal company, with the holiday season carrying significant weight, and any optimism here, pending guidance, should bode well for the company's long-term future.Now, on to the subsidy thing. Subsidies, briefly, came up on the call, but let me make this completely clear: When the Verizon CFO said he would be looking at "subsidy reduction" (and he did say this), he did not specifically call out Apple, iPhone 5 or whatever iPhone we get next. It's also worth pointing out, as caught by Twitter follower @craig_kimball, that Verizon spoke of the same thing as long ago as the first quarter of 2012. This talk -- or these threats -- of cutting smartphone subsidies is hardly new. So, we've got nothing Apple-specific here, which could mean that Verizon has no plans to touch the iPhone subsidy. Maybe it will just tinker slightly with some of the other ones or the iPhone by a meaningless amount. Or maybe not. As I heard things on the call, the company's pretty happy with the way things are going regarding increased smartphone adoption and subsequent data consumption. During the Q&A session, the company touted considerable uptake in data consumption, thanks in large part to the speed of its LTE network. Fast and reliable network equals more video streaming, game playing, etc., etc. which, according to Verizon, leads to people upgrading to more expensive shared-data plans.
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