BGR posted a recent article which quotes The Loop's Jim Dalrymple as saying that Apple already has a Verizon compatible (CDMA) iPhone laying around. The problem is that they need to negotiate a deal with Verizon.
This would not be unusual for Apple to design hardware (or software) in advance an anticipation of a release, even if it never sees the light of day. They did this with the intel compatible version of OSX when they switched over from the IBM G4/G5 lineup.
The real problem is negotiating a deal with Verizon. Verizon obviously has had great success with the Android operating system. In addition, they make more profit on the Android handsets as they don't have to cut any type of revenue share deal with HTC or Motorola or anyone else for that matter... and Google gives out the OS for free so the handset makers save money on R&D.
It all boils down to that war between Google and Apple.
Most interesting is Apple's perspective. They could certainly use this time to announce a deal with Verizon and try to redirect people's attention away from the iPhone 4 antenna design fiasco... and at the same time it would really steal alot of thunder from Google's sails. Verizon is without a doubt the biggest carrier and proponent of pushing the Android operating system. If Apple decides to court that partner it would put a damper on the spread of Android.
Let's face it, it's an all out war between Google and Apple. Both sides have a lot to gain or lose in this war... so how will it boil down? Only time will tell.
Don't forget to check out our sister site dedicated to the Apple iPhone 4 @ iPhone 4 Forum
Source: iPhone 4 Forum & Loop Insight