Verizon: No Wires, Employees, or iPhone 5?

With news of a $10 billion dividend, the release of the Apple

iPhone 5 in the near future, and a growing 4G LTE network, what is holding Verizon Communications

back? Verizon has been pressing on the throttle with its wireless services at the cost of decreasing revenue in wireline operations. That, along with potential losses from the recent strike of 45,000 union employees, could hinder the telecommunications giant. Wirelines Grounded

reported that an overwhelming majority of Verizon Communication's debt – $40.4 billion out of $47.7 billion – stems from its wireline business, which is largely masked by the financial statements from wireless profits. Verizon Communications is only a 55 percent owner in Verizon Wireless, with the other 45 percent belonging to Vodafone

. Verizon wireline earnings have also decreased by $4.8 billion since 2006. As Sanford C. Bernstein has noted, the federal government's bonus depreciation tax break is due to phase out soon, causing Verizon Communication's taxes to rise. In 2010, Verizon's reported tax expense was $2.5 billion, but filings show it only paid $430 million. Assuming the break doesn't get extended, Moody's estimates that Verizon's cash taxes will rise to as high as $2 billion next year and to between $4 billion and $6 billion in 2013. Recently, Verizon Wireless announced a $10 billion dividend to its two owners with

going to Vodafone. Moody's estimates Verizon Wireless will distribute a total of $21 billion to $22 billion in 2012. The best position would be to pursue advances in the wireless operations such as the growing 4G LTE network in hope that Verizon Communications doesn't have to rely on wirelines revenues. No Employees, No iPhone? With almost a quarter of its employees on strike, Verizon Wireless must not underestimate the multiple facets of the anticipated iPhone 5 launch. Most likely, Verizon Wireless customers will not switch providers that easily but unnecessary instability could be harmful to the company's image if the launch does not go smoothly. Bill Palmer,

, believes that an early iPhone 5 launch on Verizon Wireless could convert AT&T

users, which would make it necessary to have more employees to process new accounts available only at Verizon Wireless retail stores. Palmer notes that a strike by tech support and IT workers could result in server crashes if large orders for iPhones are placed through verizonwireless.com. "If Verizon's tower builders join the strike, or if construction is put on hold due to its internal overseers being on strike, that could mean a delay in further 4G LTE buildout," adds Palmer. (That is, assuming the iPhone 5 has 4G LTE capability.)