Apple Inc. (NASDAQ: AAPL) is expected today to launch its latest iPhone, dubbed the ’4G’ by the Apple-watching hordes. The device is not the first out of the chute with a 4G moniker, though. The HTC EVO 4G device, using the Android operating system from Google Inc. (NASDAQ: GOOG), hit stores on Friday and was a smashing success according to Sprint Nextel Corp. (NYSE:S).
The HTC EVO is built by Taiwan’s HTC Corp. and uses Sprint’s touted fourth-generation WiMax network which was built out by Clearwire Corp. (NASDAQ: CLWR). The device also works on Sprint’s 3G network. 4G network coverage is currently limited to 33 markets covering 43 million people. By the end of the year, Sprint expects to have 4G service available in markets totaling 120 million.
Apple’s 4G iPhone, available exclusively through AT&T (NYSE: T), won’t get a chance to show its stuff until early next year, when AT&T finally launches its 4G network. The company has been upgrading its 3G network, but that technology boasts a speed of only 7.2 megabits/second.Rival Verizon Wireless, jointly owned by Verizon Communications (NYSE: VZ) and Deutsche Telekom AG (NYSE: DT), plans to roll out its 4G network later this year. The LTE-based technology has posted speeds of 60 megabits/second in early trials. That’s a huge difference.
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And it may be a difference Apple can’t live with. Verizon has denied that it is planning to offer an iPhone, but Apple’s CEO has said there might be an advantage (to Apple) of offering the phone on more than one network.
He’s right, of course. But not just because of handset sales. It’s about the advertising. Apple’s iAd network is soon going to be fighting it out with Google’s AdMob network, and while the iPhone may be a huge seller for Apple, Google’s Android operating system has already surpassed Apple’s OS in installed base.
What will matter in mobile advertising is installed base that can be addressed on the ad platform. Google derives no revenue from Android, but it is counting on the combination of Android and AdMob to deliver big revenues down the road.
Apple is falling behind in that part of the game, and sticking with AT&T exclusively will not boost Apple’s ad numbers. AT&T, of course, is willing to pay almost anything to keep the exclusive deal, but that’s not in Apple’s future best interests.
All of today’s excitement about the 4G iPhone won’t affect the coming battle over mobile advertising. That’s going to be a real knife fight. And remember, there are no rules in a knife fight.
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