Verizon Confirms iPhone Unlimited Data Plans; Reports Lower Q4 Revenues

As expected, today Verizon confirmed ahead of its 4Q earnings presentation that it would be offering the Apple (NSDQ: AAPL) iPhone with a $30 dollar unlimited data plan. “I’m not going to shoot myself in the foot,” Verizon president and CEO-elect Lowell McAdam told the WSJ today. “Not offering an unlimited plan would put up a barrier for customers who might otherwise switch from AT&T.” Driving customer uptake with the iPhone will be a big priority for Verizon, which reported lower-than-expected earnings for Q4 — possibly because people were holding back in anticipation of the Apple handset.

Revenues for the quarter were $26.4 billion, a 2.6 percent decrease from the same quarter a year ago. Verizon points out that Q4 a year ago included revenues from assets that have since been divested. On a comparable basis, revenues actually rose by $592 million, or 2.3 percent. Profit meanwhile rose to $4.65 billion versus $2.37 billion a year earlier. Both revenues and profits fell shy of analysts’ expectations, according to Marketwatch.

Wireless overview: Verizon now has a total of 87.5 million mobile retail customers. In the quarter it added 872,000 retail postpaid customers, and lost 69,000 retail prepaid customers for a net add of 803,000. Smartphone usage is up a lot: 26 percent of Verizon’s postpaid customers now use smartphones, an 11 percent increase on the same quarter a year ago. Among those new to the network, a whopping 75 percent signed on with smartphone plans. That’s driving data revenues and Verizon is aiming for 50 percent of its wireless revenues to come from data services by 2012 — they were 37.1 percent of ARPU in the current quarter.

LTE and wireless broadband: Verizon’s picked up 65,000 customers already for its LTE service since launching it in December. The company is continuing to roll out the network across the U.S. and is adding handsets to its current dongle offerings later in the year. Verizon sold some 86,000 tablets in the quarter, with most of them iPads and Samsung Galaxy Tabs; interestingly, 96 percent of tablet buyers were new wireless data customers for Verizon.

Some other Q4 wireless stats: Verizon Wireless customers sent or received more than 180 billion text messages and nearly 4.5 billion picture/video messages; there were also over 20 million wireless music and video downloads.

Preparing for the iPhone: “We’re not going to have any flaws on the iPhone launch,” Verizon’s CFO Francis Shammo promised investors in the earnings presentation today. Verizon says it’s hired an additional 3,000 customer service people to focus on the new Apple device; and existing customer representatives have been selling the iPad “to get used to the interface.”

Verizon didn’t give any estimates for how many iPhones it expected to sell. “We don’t have all the answers but we probably will do better than most people think,” said Ivan Seidenberg, the CEO. “We do believe that our brand and network will drive a lot of people. Over the next couple of quarters when we get some experience on the volumes we’ll share that information. It’s much better than overestimating something that we don’t know.”

Vodafone: Verizon says it is changing its relationship with Vodafone (NYSE: VOD), which owns half of Verizon Wireless, in the year ahead. “In the past it’s been a financial arrangement but now we’re putting together a stratgy to align our technical roadmaps, device procurement and enterprise [services],” said McAdam in the presentation. That, of course, becomes significantly easier now that Verizon and Vodafone, which respectively use CDMA and GSM networks, are both working to the same LTE standard for the next generation of their services.

— FiOS is becoming an increasingly big driver of of Verizon’s wireline revenues. In Q4 it made up 53 percent of consumer revenue comes from FiOS now. The company added 197,000 net new FiOS Internet customers and 182,000 net new FiOS TV customers, bring total numbers to 4.1 million FiOS Internet and 3.5 million FiOS TV customers.