Apple News, Analysis and Podcasts

Everything seems to be going right for Apple lately. iPods appear to be selling stronger than conventional wisdom had believed, iPads are in the midst of a large growth curve, and Mac sales continue to eat away at PC market share, quarter, by quarter, by quarter...

But not everything has gone according to Apple's best laid plans. Apple TV hasn't exactly set the world on fire and Android has clearly taken off, giving many non-AT&T customers a viable option to iPhone. Android has become Apple's Elephant in the room, but in this case, everyone's talking about it and no one seems be able to get it to go away.

General consensus is an iPhone on Verizon is just around the corner, but this marriage may prove to be Apple's edge-of-a-knife moment. Will iPhone become Verizon's number one selling smartphone? Or will Verizon prove to be Android saturated with too few customers able to make the financial leap to iPhone?

If the answer is the latter, it means Android won't be derailed any time soon, while Apple risks iPhone looking like a flop on Verizon. If Apple does not hit a home run with Verizon, Android will look like an equal if not a superior choice for consumers.

Apple's iPhone is expanding in China and elsewhere around the globe, but Google's Android momentum in the west shows few signs of slowing down. There are a number of movies Apple could make, but there is one major play that would rapidly change the game. Go Nuclear.

If Apple truly wants to level the landscape, they turn their keys, push the button and deliver iPhones for free (3GS), $49 and $99 (iPhone 4). Consumers are greatly swayed by up-front costs. Apple delivering the iPhone without causing major pain to the wallet would create a major disruption in the cell phone world. Apple would boost sales (and their economies of scale), see a rapid lift in market share, and likely stall Android momentum.

There are two areas that would stop Apple from making such a move. No matter what size of sales increase, iPhone's gross margin would take a hit and Wall St. is already wary Apple's recent decline in this area. Secondly, Apple's brand is delivered through their product's perceived value, not cheap price points. If the Verizon effort stalls, and Apple believes they need to make a move, Steve Jobs could pick up the red phone and give the order, leaving Android's hardware vendors running for cover.

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