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With the impending release of the iPhone 5, Apple (NASDAQ:AAPL) has not only stirred up competition in the market for smartphones but also in the market of mobile service providers.
Today, ahead of next week’s Apple’s launch event, AT&T (NYSE:T), the nation’s second largest wireless network carrier, announced in a slew of press releases that it will extended its 4G LTE coverage to 7 markets and bring coverage to 47 new markets by the year’s end.
The company has invested more $115 billion to enhance its wireless and wired network over the last five years.
An onslaught of press releases sent out by AT&T’s PR department bids its new markets in St. Paul-Minneapolis, Birmingham, and Denver-Boulder, among others, to enjoy the company’s innovation and investment in the “nation’s largest 4G network.”
Yet this latest attempt to take market share from Verizon (NYSE:VZ) will most likely be for not. The Verizon LTE network is the largest in the United States, reaching 230 million people. By the end of 2012, the company is expected to add another 260 million people. AT&T’s network only covers 80 million people, about a third the number covered by Verizon.
Jefferies analyst Thomas Seitz believes that LTE will play a large role in consumers’ choice of networks after the release of the iPhone 5. Verizon’s own LTE coverage will allow it to take market share from AT&T and Sprint (NYSE:S) because the newest iPhone will most likely support LTE.
According to Seitz, AT&T’s primitive LTE network has no hope of catching up to Verizon before the release iPhone 5.
“We believe this network advantage could lead to a share shift towards Verizon, primarily at AT&T’s expense,” said Seitz to the International Business Times, “which we estimate could see its market share of iPhone sales decline modestly to 45 percent in 3Q12 from 47 percent in 2Q12.”
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