Verizon expects LTE-only handsets by next year, CFO thinks smartphone OS competition will lead to lower costs

Verizon Wireless is currently transitioning its 3G network customers to 4G LTE, but the company has not deployed the service to enough areas to feel comfortable introducing phones that have only LTE radios. Fierce Wireless reports that will change next year according to comments made by Verizon CFO Fran Shammo. Speaking at a Deutsche Bank conference, Shammo said that his company expects to deliver smartphones without CDMA connectivity as early as 2014. All new Verizon smartphones have 4G LTE, but the devices also have cellular radios to use Verizon's 3G network. A planned transition to Voice-over LTE, and the expansion of 4G LTE that is expected to reach its current 3G footprint this summer, means the carrier could begin delivering LTE-only phones next year.

Removing the need to include 3G chips in new phones will lower the costs of smartphone manufacturing, which will also lower the costs of subsidies. Verizon will be the chief beneficiary of those savings because lower subsidy costs means the carrier doesn't have to pay as much to a phone manufacturer, not that consumers will pay less when purchasing a phone from the carrier on contract. Shammo adds that increased competition from smartphone vendors using Windows Phone 8 and BlackBerry 10 might also help lower its costs, saying, "I'm a believer that over the next two to three years subsidies will start to decrease just because of the ecosystems."

Shammo's theory only makes sense if devices running the Windows Phone and BlackBerry operating systems appeal to more consumers. Apple's iPhone and several makers of the DROID brand currently dominate Verizon smartphone sales, but changes in consumer behavior could work in Verizon's favor, according to Shammo.