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In the past few days, rumors have been flying that Verizon has been in talks with Apple to distribute the iPhone on Verizon’s CDMA network. While this is something that I support, as I happen to despise AT&T’s service and coverage – I am skeptical of such reports. The Apple Marketing Machine is no less than genius, any tiny changes in the entire product line, or even rumors as such puts the media into a frenzy.

Lets take a look at the angle each of the 3 companies would have in the rumored deal between Apple and Verizon with a CDMA iPhone:

Apple - Apple might sell more iPhones if they added Verizon as a vendor, but at the cost of having to sell, support, refurb, and manufacturer a different SKU of the iPhone, no small task. Would the additional sales offset the cost of the ramp-up, research and development, and marketing effort? Maybe those Dollars could instead be spent on advertising or R&D on new features for their existing SKU. Additionally, most of the worlds wireless carrier use the AT&T aligned  GSM/3G as opposed with the Verizon aligned CDMA / EVDO. Building an EVDO iPhone would not give them the global market penetration that they got with the GSM iPhone. Now, Verizon does have 80 million customers in the US, it comes down to some Apple accountants to decide if the investment will prove cash-positive. My guess would be that they would be more inclined to spend the money on R&D on the existing line.

Verizon – Verizon has something to gain by putting the iPhone in it’s lineup. It would get the ability to keep customers who are in the “have to have it” category for the iPhone. I am one of them, I tossed my Blackberry, paid the $175 cancellation fee and got myself an AT&T iPhone. The one thing that I take away from the experience is that AT&T service is not nearly that of Verizon, and given the choice I would definitely go with Verizon. With that said, Verizon does have 80 million subscribers.  It’s not like they are hurting for business and need a trick up their sleeve in order to draw customers. It would make much more sense for Sprint to try and get the iPhone onto their shrinking network. Verizon can easily place their bets on upcoming Android phones that would be released with the same sort of time frame a CDMA iPhone could be released (considering AT&T’s now exclusive agreement with apple).

AT&T – Considering that the AT&T exclusivity contract with Apple is set to expire at the end of this year, it is almost certain that they are in negotiations with Apple for an extension to that contract. Also consider that I am certainly not the only one who holds disdain for AT&T service like I do.  Of the 3 companies mentioned – AT&T would have a HUGE amount to lose if this sort of deal would go through. I personally would likely leave AT&T for Verizon, given the choice – even considering early cancellation fees associated with the move. Yes, the AT&T network is THAT bad, and the iPhone is just THAT good to make up the difference.

Now, with Apple’s reputation for being hardball negotiators, wouldn’t it be very VERY adventagous for them to spread unconfirmed rumors into the wild suggesting an Apple Verizon iPhone? This would put pressure on AT&T to make a deal that might otherwise be more in their favor. Giving Apple the ability to clean AT&T’s clock. AT&T has much, much more to lose by the Verizon iPhone than either Verizon or Apple have to gain.

In any event, if I were a betting man, and had a dollar to spare – I would bet that AT&T gets another year or two of exclusive iPhones while giving Apple the bank in the process.