A survey suggests a huge chunk of AT&T iPhone customers plan on defecting to Verizon, but that seems unrealistic.
Research group ChangeWave on Friday released results of a survey polling about 4,000 customers. Most notably, it found that 26 percent of AT&T iPhone customers plan to switch to Verizon, and 16 percent of all AT&T subscribers overall say they’ll switch to Verizon because of the Verizon iPhone.
ChangeWave adds that AT&T has made significant progress improving its network to decrease dropped-call rates, but it says that isn’t enough to prevent a mass exodus to Verizon.
“The findings suggest AT&T is now taking concrete steps to try to improve long-standing service issues,” ChangeWave said in its report. “But can it do so quickly enough to forestall large-scale defections to Verizon? Not according to our ChangeWave survey results.”
Ever since Apple and AT&T released the iPhone in 2007, tech observers have squabbled about the day Verizon would score the coveted handset. Verizon has consistently ranked higher than AT&T in customer-satisfaction surveys because customers found the network to be more reliable. Therefore, it’s easy to assume that a Verizon iPhone would result in a devastating blow to AT&T.
ChangeWave’s survey may back that idea, but it’s not that simple.
AT&T last year noted that 70 percent of its subscribers are on family plans and 40 percent are part of corporate plans. (There is some overlap between the two types of plans.) That means multiple devices are tied to these plans, and it would be difficult for them to transition to another network. Also, in a business scenario, it’s unlikely a corporation is going to switch all its employees to Verizon just because it now has the iPhone.
Add to that the fact that many AT&T iPhone customers are still tied to two-year contracts. To switch to Verizon, they’ll have to pay an early-termination fee and shovel up even more money to pay for a phone that they probably already have. In June 2010, AT&T increased the early-termination fee from $175 to $325.
Long story short, AT&T has made switching for many subscribers a pain in the butt, and that’s part of why we’re unlikely to see a big switch.
The one major feature that the Verizon iPhone has, which the AT&T iPhone doesn’t, is hotspotting — the ability to turn the handset into a Wi-Fi connection for multiple computers to connect to — and that doesn’t seem like a killer feature to make you switch. The latest iPhone beta software reveals that the hotspot feature is technically available for AT&T iPhones; now it’s up to AT&T to decide if it wants to support it. I’m guessing AT&T will in order to compete.
The one major feature that the Verizon iPhone doesn’t have that the AT&T iPhone does, is the ability to simultaneously use data and voice. So if you’re on the phone, you can’t switch to the Yelp app to look up an address, for example, and then return to the call. That’s a limitation of Verizon’s CDMA network, and for some, that will be a big minus.
Suddenly the prospect of switching to Verizon doesn’t sound so appealing, and for many iPhone customers it probably won’t be worth the effort and money.
As a few other tech observers have pointed out, the Verizon iPhone poses more of a threat against Android phones on Verizon than it does to AT&T. Prior to the Verizon iPhone launch, an early survey suggested that a substantial number of current Verizon customers would switch to an iPhone.
That seems more believable, because I can’t name a single person who voluntarily switched to Verizon because of Android, but I can name several people who switched to AT&T just for the iPhone.
Photo: Sam Gustin/Wired.com
Chart: ChangeWave
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