Barclays Capital analyst James Ratcliffe has predicted that Apple’s Verizon iPhone will hit the market in the first quarter of next year. Ratcliffe said that Verizon would activate 9 million new iPhones by the end of the year and the launch of a Verizon iPhone could lead to the defection of between 500,000 and 1 million customers from AT&T to Verizon Wireless.

Ratcliffe however, noted that the device’s appearance on a new carrier will not prove to be a game-changer as predicted by some experts. “The iPhone would be a plus for Verizon, but not a seismic industry change, given the relative stickiness of smartphone customers,” Ratcliffe wrote in his note dated June 22.

“The primary source of Verizon iPhone subscribers would be pent-up demand by existing Verizon subscribers,” he added. Ratcliffe predicted that an initial Verizon iPhone will not be Long Term Evolution (LTE) 4G capable, although the carrier is working to develop faster standard for its networks.

“While it would make sense from Verizon’s perspective to have the first Verizon iPhone coincide with the LTE launch, it appears unlikely that Qualcomm will have a dual-mode voice and data chipset commercially available in time for a first quarter 2011 launch. This does not entirely preclude an LTE iPhone, however, as Apple could elect to incorporate separate chipsets for voice and data,” noted Ratcliffe.

Verizon iPhone 4G release has been speculated for long and now all we can do is wait and watch if this prediction turns out to be true.