Verizon is getting the HTC Touch Pro 2 and the Diamond 2 this summer, which will put them back on par with most carriers.
I'm convinced that the vast majority of Verizon subscribers just want a simple camera enabled flip phone, and use it on a family plan.
That said - they DO have fantastic 3G coverage, and are currently the only ones selling the MiFi.
Telling Apple "no" to the iPhone was a big mistake, but they are still a very big and profitable operator, something that can't be said about Sprint.