When Verizon (VZ) reported fourth quarter earnings on January 26, everything was in line. There were no real surprises. And that was disappointing to investors who were looking for signs that a rising economy was lifting margins in Verizon’s legacy landline business or who were hoping for some sign that Apple (AAPL) was going to strike a deal with Verizon to sell the iPhone.

Didn’t happen.

So investors are stuck with the same old story. Which fortunately is pretty good despite its lack of surprises.

Verizon reported fourth quarter 2009 earnings of 54 cents a share (matching Wall Street projections) and revenue of $27.09 billion (just short of the analyst consensus at $27.33)

The company added 2.2 net wireless customers (that’s before the effect of acquisitions) in the quarter. For the critical FiOS Internet and cable TV unit, the company added another 153,000 for each service. That brought total Internet customers to 3.4 million and total TV customers to 2.9 million.

Looking a little deeper into the numbers Verizon strikes me as a second half of 2010 story.

Right now the company is using higher handset subsidies to grow its smartphone business. Only 26% of Verizon’s wireless customers own smartphones (versus 40% or more at AT&T (T), thanks to the iPhone). Smartphone owners use more higher-margin data and broadband services so increasing the percentage of customers with smartphones is crucial to driving margins higher.

Of course, as AT&T’s problems show, if you drive up the number of customers using these services, you’d better build out your network to handle the traffic. For Verizon that means higher capital spending on wireless in 2010.

 The company’s legacy landline business is supposed to be the cash cow that supports these subsidies and the build out for smartphones and the FiOS Internet and cable businesses. But because of the economic slowdown, businesses have been cutting rather than adding lines. In addition the soft economy has meant slower growth in higher margin broadband and data services for the landline business.

There’s nothing here that a slightly stronger economy wouldn’t fix, however, and the company’s continued investment in wireless smartphone, FiOS, and landline data services will pay off in the future.

The yield on February 15 was a very attractive 6.6%.