Edible Apple

BusinessWeek is reporting that Verizon has been in talks with Apple regarding plans to release two iPhone-like devices on the Verizon network, with one device potentially slated for release as early as this summer.

One device is referred to as an “iPhone Lite”, while the other is referenced as an Apple “media pad” with a form factor larger than an iPhone, but smaller than a netbook.

According to the article, this touchscreen media pad, which Apple has purportedly already built prototypes of, will allow users to view photos, listen to music, browse the web, view HD video, and make calls over a wi-fi connection.  So it basically sounds like a bigger version of the iPod Touch.

As for the “iPhone Lite”, it’s described as being a smaller and less expensive version of the current iPhone.

In a recent interview with BusinessWeek, Verizon Wireless CEO Lowell McAdam confirmed that the company has spoken with Apple executives. “In the last six months, I have talked to Steve Jobs,” McAdam says. Although McAdam would not say what the two companies discussed, two people familiar with the subject said talks covered the new smaller iPhone-like device under development.

News of a smaller iPhone model and an Apple media tablet comes hot off the heels of a USA Today report which all but predicted that Apple would be releasing a CDMA compatible phone for Verizon in 2010.

With so many reports coming in from “unnamed sources”, it’s hard to get a read on what’s actually going on with Apple and Verizon.  At the very least, we know that the 2 companies are talking to each other, but that in and of itself is no reason to assume that a deal is imminent.

Remember, Verizon initially balked at selling the iPhone in 2007 over concerns that Apple was demanding too much control over the device.  It’s very possible that Apple’s iron like grip over the iPhone and the app store might drive Verizon away yet again.  But seeing as how the iPhone has been a big success with AT&T, it’s also possible that Verizon might be more willing to cave to Apple demands on this go-around.

BusinessWeek also raises the idea that negotiations with Verizon may simply be a ploy to extract more favorable contract terms from AT&T as they look to extend their exclusive distribution rights to the iPhone.

Whatever the outcome of Apple’s discussions with Verizon Wireless, they at least could be used as a bargaining chip to help win concessions from AT&T. Apple may want AT&T to absorb an even larger portion of the costs of manufacturing the phone. Plus, it may seek to obtain promises from AT&T to beef up investments in its network and customer service operations.

Either way, this is shaping up to be an extremely interesting summer for Apple.