Sprint Challenges Verizon and AT&T with Apple iPhone

The nation’s third-largest wireless carrier, Sprint (NYSE:S), is reportedly set to join Verizon (NYSE:VZ) and AT&T (NYSE:T) in carrying Apple’s (NASDAQ:AAPL) iPhone this fall.

Gene Munster, an analyst at Piper Jaffray (NYSE:PJC), says the move could increase iPhone sales growth from 30% to 37% in 2012. According to Munster’s estimates, Verizon (NYSE:VZ) sold 4.6 million iPhones in the first two quarters of 2011, and is expected to have sold 12 million iPhones by the end of the year, with the iPhone accounting for 11% of total phone sales at Verizon in its first year being offered through the carrier. If the iPhone were to account for 11% of Sprint’s (NYSE:S) total phone sales, Munster estimates that Apple could sell an additional six million iPhones next year through Sprint. In calendar 2012, Munster expects a total of 117 million iPhones to be sold.

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Of course, those numbers hinge on the expectation that Apple (NASDAQ:AAPL) will release a new iPhone this fall, giving people already owning an iPhone a reason to buy another. While rumors about the much-anticipated iPhone 5 are numerous, “It does appear that a 2011 launch of the iPhone 5 at Sprint (NYSE:S) will actually happen,” says Wedge Partners analyst Brian Blair, who expects the carrier to announce its new iPhone availability in late September when Apple is expected to announce the new handset, to be followed in early October with its release.

The move will not only level the playing field between Sprint and competitors AT&T (NYSE:T) and Verizon (NYSE:VZ), but it will also give Apple yet another leg up on the smartphone competition. The iPhone is already the single most popular phone model in the U.S., but smartphones using Google’s (NASDAQ:GOOG) open-source Android operating system have a larger combined share of the market. While iPhone sales have remained relatively steady since 2009, shipments of phones using Android have climbed 379% in the last year. Many carriers, both large and small, national and local, support Android phones created by LG (NYSE:LPL), Samsung, and Motorola (NYSE:MMI). But as Apple makes its phones available to more people, the margin between Apple and Android could soon narrow. And if Apple releases a lower-end iPhone as has been rumored, it will be able to compete on price as well.

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