iPhone 4S: Winners and Losers

It came as a surprise to most when Apple’s big media event Tuesday ended abruptly after Tim Cook spoke glowingly about the iPhone 4S, the latest addition to the company’s smartphone family. Reporters with scrunched up faces peered at each other with that curious, didn’t-they-forget-something look.

But no, the iPhone 5 wasn’t to be. Instead, we got a souped-up version of the iPhone 4. It’s faster, the camera is better and battery life is improved. Yet that won’t satisfy everyone, as the 16-month wait between full-blown iPhone upgrades will likely become 24 months or more. So who are the winners and losers stemming from Tuesday’s announcement?

Winners

Sprint. As expected, America’s third-largest wireless carrier is getting its hands on the new version of the iPhone when it goes on sale October 14. Finally, beyond promises of keeping its unlimited data plans intact, the carrier has the most important piece of the puzzle it needs to compete with its big sisters. But whether Sprint will stay in the win column remains to be seen. Quoting “people familiar with the matter" this week, the Wall Street Journal said Sprint committed to buying more than 30 million iPhones, a multibillion-dollar deal that might wind up costing the carrier money over the next three years. The upside is simple: staying relevant.

AT&T. All iPhones are created equal, right? Wrong. AT&T’s version runs on HSPA, which is simply faster than the CDMA technology on the Verizon and Sprint networks. You’ve surely seen AT&T’s commercials that stress the ability to talk and surf the Web at the same time, something not possible on the Verizon and Sprint versions. (For more on network speeds, see LTE in the losers section below.)

Smartphone competition. Manufacturers like LG, Motorola, Pantech, HTC and Samsung had to breathe a sigh of relief Tuesday. The same goes for Android and other competing platforms. They still have an edge in at least one area: LTE network super-speeds. (Although one of the improvements in the iPhone 4S is a faster processor.) There are currently only eight LTE smartphones in the U.S., all Android-based, all on Verizon’s network, and all made by the manufacturers listed here.

RIM/BlackBerry: An iPhone 5 might've been the knockout blow.

Apple. Sure, the company will take criticism from those who feel cheated by not getting a brand-spankin’ new iPhone every year. It’s certainly harder to stay at the top than it is to get there, but as long as you have the world’s best-selling smartphone, there’s hardly a reason to give it a complete overhaul, at least from a business perspective. Will the iPhone 4S be the sales bonanza that an iPhone 5 would’ve been? Of course not. But with more global deals pending for the device, Apple won’t be hurting.

Losers       

Verizon Wireless. Only eight months after breaking AT&T’s four-year stranglehold on the device, America’s largest carrier already has more competition. Sprint’s entry into the iPhone world will only dilute the number of new customers Verizon Wireless signs up. Many AT&T customers wanting to switch to VzW hesitated to do so earlier this year because they were still on two-year contracts that it costs hundreds of dollars to break. Now those AT&T customers have another option if they want to switch. About the only benefit for Verizon Wireless is that it remains the only carrier, for now, that offers LTE smartphones. Speaking of which …

LTE. Verizon Wireless has had its 4G LTE network up and running for almost a year now, and AT&T’s is just a baby. But without the world’s marquee smartphone, LTE isn’t as big of a deal, despite its improved speeds. A survey in July showed most people don’t really know what 4G is; in fact, one-third of iPhone owners thought their device was 4G. Assuming the iPhone 5 (or whatever it will be called) will be a 4G phone, that will be a significant upgrade – and will draw more attention to the technology.

Fanboys. Anything short of a complete redesign to keep them buzzing was sure to be a disappointment. But they’ll get over it.

Analysts. Can we believe anything these guys say? Why their investors rely on them for accurate predictions – at least about Apple products – is anyone’s guess. Most of these so-called experts thought we’d either see an iPhone 5 or both an iPhone 5 and the 4S, but very few saw only the 4S announcement coming. Remind me not to take them on my next trip to Vegas.