How the iPhone could get to Verizon

One of the most-asked questions about wireless devices is, "When is the Verizon iPhone coming?" Is it January? July? Or some time in 2012?

There isn't a clear answer yet. There's been talk about such an event since very soon after Apple introduced its smartphone in 2007, but rumors have begun regaining momentum this year. It seems like every week there's a new angle, a fresh theory, or suddenly uncovered factoid that points to Apple finally opening up the iPhone to another carrier in the U.S. besides AT&T, and specifically Verizon, which is the U.S. largest carrier. None of it has been confirmed and no one has gone on the record saying when or if it would happen.

So rather than trying to piece together clues or referee the debate about when, why, or if, let's get practical. What, exactly, would have to happen for Apple to bring the iPhone to Verizon? There are a few barriers in the way, some technical, legal, strategic, and intrinsic to the culture of the companies involved. None of the following is impossible to overcome and in all likelihood will be eventually.

The exclusive contract with AT&T
Everyone knows that Apple struck an exclusive agreement to keep the iPhone on AT&T's network (and away from other U.S. carriers like Verizon) for a certain amount of time. But the exact terms are somewhat of a mystery.

What we do know: when the iPhone debuted on AT&T in 2007, USA Today reported that the contract ran for five years, which would put the expiration date at 2012. We also know that in court documents submitted in 2008, Apple corroborated the USA Today report.

The question is, does that still hold up? It's very possible that the terms of the contract between Apple and AT&T have changed since the original agreement. Apple doesn't talk about it at all, which is in line with how it operates. The company has expanded to include multiple carriers of the iPhone in other countries, but it usually demurs on whether it would eventually do that in the U.S.

New chips
Changing the chip in the iPhone that allows it to run on networks besides GSM (which AT&T and the vast majority of carriers around the world use) is the major technical change to allow the iPhone to work on Verizon's network.

There's lots of speculation about how exactly that would be done. There have been a few analyst reports saying that Apple is ordering a few million CDMA chips. Those stories are usually interpreted to mean a Verizon phone is in the offing, since Verizon currently has a CDMA network. But CDMA technology will be phased out soon by Verizon and others, and the idea of Apple producing a new device that relies on old technology just doesn't feel right.

In its place, Verizon is working on its LTE 4G network. It's not ready yet, but Verizon has said it will have rolled out LTE to 30 cities by the end of 2010. Though even more cities are scheduled for next year, not having full coverage to offer iPhone customers would be a somewhat difficult sell.

If there were to be a Verizon phone next year, the most likely scenario is a dual-mode phone that works on CDMA and its new LTE 4G network. Such a phone could pick up CDMA service when it couldn't find an LTE network. It's similar to what Sprint has opted for with its Evo smartphone--it uses 4G WiMax where available, but otherwise it relies on 3G. The major roadblock to that is that LTE chips for phones are not available yet, and it's not clear when they will be.

Smaller feature changes
A Verizon iPhone would also mean a few other minor tweaks to how the iPhone is right now, like SIM cards (AT&T uses them, CDMA operators like Verizon do not). And there would be different subscription plans and possible new early termination fees, depending on Verizon's own policies.

There would be other changes for Verizon customers too switching to an iPhone on LTE: Verizon's current set up does not enable smartphone users to make a phone call while browsing the mobile Web. That's because it uses CDMA and EVDO, and EVDO doesn't allow voice and data to travel over the same channel simultaneously. But throwing LTE chips into its phones would change that. And that would go for any Verizon phone, of course, not just the iPhone.

Verizon's self-promotion
Verizon has a habit of blanketing phones that run on its network with its own software and features, the most recent example being the release of the Samsung Fascinate. The phone uses Google Android, which is open-source mobile software, and Verizon has taken liberal license with adding its own flourishes. All the carriers that use Android have the option of doing it, but the best example of Verizon's tendency to put its own stamp on things is making Bing the default search option on the phone. After some push back, Verizon relented.

Now, Verizon can do that with Android, an open technology in which the carrier has invested very heavily. But that kind of customizing of phones on its network won't fly with Apple, which is very protective of its products and customers' experience, which Verizon knows by now.

That Apple approached Verizon about getting exclusive access to the iPhone before AT&T is well known. The two could not agree on several key issues, including retail distribution, financial details, and Apple's insistence on controlling the relationship with customers. A Verizon executive told USA Today in 2007 a major sticking point was that Apple "would have been stepping in between us and our customers to the point where we would have almost had to take a back seat ... on hardware and service support." Apple of course then partnered with AT&T instead.

The Verizon-Apple disagreement took place before the iPhone became the most influential and profitable smartphone currently on the market. It's likely Verizon would be more amenable to Apple's demands this time around. Really, if any carrier is going to have the phone, they'll have to be since Apple has zero interest in ceding any control over its most important business, as AT&T has discovered.

CNET's Marguerite Reardon contributed to this report.