Verizon Pays for Stupidity

I'm as convinced as ever that Verizon (NYSE: VZ  ) needs the iPhone, but there's zero chance of Apple (Nasdaq: AAPL  ) agreeing to do business with Verizon as it is today. The carrier has too many problems.

Over the weekend, Verizon admitted it mistakenly charged millions of customers data fees they didn't deserve because of what appears to have been a software bug. The carrier could end up paying as much as $90 million in refunds, media reports say.

But even that may not be enough. The Federal Communications Commission could also impose penalties for failing to notify customers about the problems, which, according to The New York Times, have been occurring since 2007.

Yeah, Verizon won't be doing business with Apple anytime soon. Not so much because it favors Motorola (NYSE: MOT  ) and Google's (Nasdaq: GOOG  ) Android platform over the iPhone -- though that does appear to be the case -- but because Steve Jobs isn't about to let broken technology anywhere near Apple's crown jewels.

Don't take my word for it: Read Jobs' rant against Adobe Systems (Nasdaq: ADBE  ) and its Flash technology sometime.

Interestingly, Verizon CEO Ivan Seidenberg seems to know his company isn't ready to carry the iPhone. Here's an excerpt from comments he made at a recent Goldman Sachs conference:

We don't feel like we have an iPhone deficit. We would love to carry it when we get there, but we have to earn it. We have to show all the suppliers that we have equal treatment, and we have a network for people to put all of their equipment on. [Emphasis added.]

That's right, Mr. Seidenberg. You have to earn it, and you haven't yet.

Now it's your turn to weigh in. Will Verizon and Apple ever work together? Share your thoughts in the comments box below, and if you're interested in Verizon, click here to add it to your Foolish watch list.

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Fool contributor Tim Beyers is a member of the Rule Breakers stock-picking team. He had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. The Motley Fool owns shares of Apple and Google and is also on Twitter as @TheMotleyFool. The Fool's disclosure policy can haz cheezburger. Nom nom nom nom nom.


Read/Post Comments (7) | Recommend This Article (6)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 04, 2010, at 4:14 PM, XMFTom7 wrote:

    Actually, Jobs & Apple seem to have reversed themselves somewhat on keeping Flash over the iOS platform: http://news.cnet.com/8301-30685_3-20015954-264.html

  • Report this Comment On October 04, 2010, at 4:16 PM, XMFTom7 wrote:

    "off the iOS platform," even. :)

  • Report this Comment On October 04, 2010, at 4:27 PM, irieman96 wrote:

    ". . . Steve Jobs isn't about to let broken technology anywhere near Apple's crown jewels."

    Except for the little antenna problem with the iPhone 4 and AT&T's difficulty with wireless network traffic network coverage.

  • Report this Comment On October 04, 2010, at 4:38 PM, RunAmokTech wrote:

    "Software bug" is not even remotely accurate. I and many, many others have been complaining to Verizon about this for years. They knew exactly what was happening and deliberately chose to ignore it - because so many people simply don't look at the details and just pay it. Verizon simply has the world's worst customer service.

    I am absolutely certain, based on past experience, that they will *never* refund all the completely bogus charges that I have paid over the past few years. They will simply give me (and others like me) a token $6 or so to get the FCC off their backs - and look for another exploitable loophole or gimic.

  • Report this Comment On October 04, 2010, at 7:25 PM, Tgemini1974 wrote:

    Anyone who has had more than one cell phone carrier knows that Verizon is superior in their coverage. Apple needs Verizon and not the other way around. Go pick up the Droid 2 and you'll realize that Verizon does now have the IPhone (without the antenna problems). Earn the IPhone? pfft... Apples refusal to work with mainstream is just annoying. Go buy an apple computer and not be able to buy over half the software on the market. Go buy the IPhone and get stuck with AT&T. Apple has always seemed second rate to me. The IPhone was amazing when there was nothing else like it, but now their are others like it, and there will be more. I don't think there is any debate on who is the best provider out there.

  • Report this Comment On October 05, 2010, at 1:04 PM, BMFPitt wrote:

    I absolutely despise Verizon as a company and hate to ever have to deal with them, but they simply have the best network and that's what matters in the end.

    I'd love to move to something like a MetroPCS, but that isn't really an option where I live.

  • Report this Comment On October 29, 2010, at 11:22 AM, heathholley wrote:

    "Yeah, Verizon won't be doing business with Apple anytime soon"

    Interesting... Fortune magazine published an article today that the iPhone is coming to Verizon in early 2011. Is this site named after the "Fools" who write articles or the ones who believe what is actually written here?

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