AT&T Customers Remaining Loyal as Verizon and Sprint Gain iPhone
MarketWatch reports on comments from AT&T executive Glen Lurie noting that the carrier's churn rate has remained steady since Verizon and Sprint began offering the iPhone earlier this year. Some observers had expected that AT&T might experience a significant amount of customer defection once it lost iPhone exclusivity in the United States, as the carrier has been the target of a number of complaints about network coverage and other issues.
As the only GSM-based iPhone carrier in the United States, AT&T is also able to offer the iPhone 3GS free on contract, while Verizon and Sprint start with the $99 8 GB iPhone 4 as their low-end devices. While the pricing difference becomes negligible once the total cost of a two-year service contract is accounted for, customers are still attracted to the low upfront cost of the iPhone 3GS, as evidenced by the fact that it remained the second best-selling smartphone in the U.S. behind the iPhone 4 heading into the iPhone 4S launch.
While a loss of iPhone exclusivity has apparently proven to not be an issue for AT&T's customer retention, the expansion to Verizon and Sprint has had an effect on the one major U.S. carrier still not offering the iPhone: T-Mobile USA. That carrier noted as part of its earnings discussion last week that customer churn due to the iPhone continues to be an "area of concern" for T-Mobile.
"Churn has not moved at all," said Glen Lurie, president of emerging devices for AT&T. Churn refers to the number of customers who cancel services.
Lurie said the carrier's relationship with Apple Inc. AAPL +0.06% , maker of the iPhone, has been positive, and they've had record-breaking sales of the latest iPhone 4S which has led to some supply issues. U.S. consumers are looking at a week to two week wait times to get the latest iPhone 4S from AT&T, he said.
As the only GSM-based iPhone carrier in the United States, AT&T is also able to offer the iPhone 3GS free on contract, while Verizon and Sprint start with the $99 8 GB iPhone 4 as their low-end devices. While the pricing difference becomes negligible once the total cost of a two-year service contract is accounted for, customers are still attracted to the low upfront cost of the iPhone 3GS, as evidenced by the fact that it remained the second best-selling smartphone in the U.S. behind the iPhone 4 heading into the iPhone 4S launch.
While a loss of iPhone exclusivity has apparently proven to not be an issue for AT&T's customer retention, the expansion to Verizon and Sprint has had an effect on the one major U.S. carrier still not offering the iPhone: T-Mobile USA. That carrier noted as part of its earnings discussion last week that customer churn due to the iPhone continues to be an "area of concern" for T-Mobile.
Top Rated Comments
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27 weeks ago
I have been with them since the beginning of Cingular. Never had a problem with the service and my current plan fits my needs, so personally I have no reason to switch.
27 weeks ago
Also, AT&T allows simultaneous voice and data. This is huge when talking and looking something up, or when tethering.
27 weeks ago
i use voice plus data too much to switch. my at&t coverage is decent, so until verizon or sprint offer data plus voice, i'm not switching.
27 weeks ago
"Dumb Pipe is able to foster brand loyalty."
Strange times we live in, but there you have it.
Voice and Data at same time is huge.
Faster Data speeds
Since I'm the primary on my family plan I get an upgrade every year. That would be worth it to me alone.
I do have some hits and misses with coverage where I live, but no big deal. When I travel for work I have no issues at all. I'll never go back to big red. Sprint has awful coverage IMO. already had them and won't go back either.
Verizon's arrogance is too much for me anyway. They'll always be the red-headed step child IMO. :eek:
27 weeks ago
I would think the unlimited data plans a lot of AT&T subscribers still have would be a reason to stay. If you jump ship now you lose that.
27 weeks ago
I really want to ditch ATT, just can't decide if the other carriers will be better enough to warrant my ~$150 ETF at this point. Still debating whether to ride it out until the iPhone (6) or if I should just jump ship to vzw or sprint now and get a 4S.....
Any customers with sprint or vzw that can chime in on improved call quality and signal strength in the Denver/Metro area?
Any customers with sprint or vzw that can chime in on improved call quality and signal strength in the Denver/Metro area?
27 weeks ago
I was with AT&T since the first iPhone and finally was able to switch to Verizon with the 4S.
The reception difference was noticable the first day I switched to Verizon. I had no reception at my home and now I have no issues at all. I don't live in a country area either.
The reception difference was noticable the first day I switched to Verizon. I had no reception at my home and now I have no issues at all. I don't live in a country area either.
27 weeks ago
I think AT&T will be safe until people's two year contracts expire. No one wants to cancel and be charged $350 just to switch carriers. They shouldn't be over confident until their customers have been given the chance to switch. I have been with AT&T since 2007 and haven't had any problems with service. The two times I had to call customer service they were very helpful and courteous. Only time will tell.
27 weeks ago
I was one of those that swore I'd dump AT&T as soon as there was an alternative. When it was time to pull the trigger, I stuck with AT&T. I had 2 dead zones that I'd lose calls when driving about 50% of the time. Since I use handsfree in the car I'd literally hold the phone up by the windshield when I got to those areas. These dead spots have spanned over several phones so I know it wasn't my device.
When Verizon came out I knew their service in the Phoenix area was exponentially better. I know this because I also have 3 wireless access points for my business. 2 of the mifi Verizon devices, and 1 of the new 4G devices (I use the 4G with my MBP and I have 2 employees use the other mifi devices). These things never drop on me. My wife will watch Netflix movies all the way from here to San Diego on road trips and it will work the entire time flawlessly.
For me it was the talking and data at the same time. I know it's not a big deal for most people, but this is really a showstopper for me. I frequently multi-task like this. I'm a true life version of those lame AT&T commercials that show the guy talking and using the Internet at the same time. To me having this is more important than dropping calls in areas that I know I'm going to drop a call and can compensate by taking another route or holding the phone in a more ideal spot while I pass that one point on the freeway.
Things completely changed with the 4S. I have YET to drop a single call in the areas that I used to drop (I've had my 4s since launch day). I haven't really researched if others are having as good of luck as me, but I can say my experience has been excellent with the new antenna design. It's a win win for me and I'm finally 100% happy with AT&T.
Let me also add the disclaimer of these talks about these providers really should be regional. What I experience here in the Phoenix area will obviously be completely different than say someone in the Bay area or NYC. I do know one of my business trips to Las Vegas where I found myself well off the strip (I was driving in with a tradeshow booth) I had almost zero luck getting my ATT 3G (or any "G" for that matter LOL) to work when I was trying to pull up a map. My business partner could also not pull it up on his iPad either. Could have been a bad day for AT&T, or a HUGE dead spot because we couldn't get anything for several miles. He had to resort to using the GPS on his Verizon Blackberry to get us to where we needed to be. Pretty lame since we had $1600 worth of iPads in the front seat that wouldn't work (2 64GB 3g iPads).
When Verizon came out I knew their service in the Phoenix area was exponentially better. I know this because I also have 3 wireless access points for my business. 2 of the mifi Verizon devices, and 1 of the new 4G devices (I use the 4G with my MBP and I have 2 employees use the other mifi devices). These things never drop on me. My wife will watch Netflix movies all the way from here to San Diego on road trips and it will work the entire time flawlessly.
For me it was the talking and data at the same time. I know it's not a big deal for most people, but this is really a showstopper for me. I frequently multi-task like this. I'm a true life version of those lame AT&T commercials that show the guy talking and using the Internet at the same time. To me having this is more important than dropping calls in areas that I know I'm going to drop a call and can compensate by taking another route or holding the phone in a more ideal spot while I pass that one point on the freeway.
Things completely changed with the 4S. I have YET to drop a single call in the areas that I used to drop (I've had my 4s since launch day). I haven't really researched if others are having as good of luck as me, but I can say my experience has been excellent with the new antenna design. It's a win win for me and I'm finally 100% happy with AT&T.
Let me also add the disclaimer of these talks about these providers really should be regional. What I experience here in the Phoenix area will obviously be completely different than say someone in the Bay area or NYC. I do know one of my business trips to Las Vegas where I found myself well off the strip (I was driving in with a tradeshow booth) I had almost zero luck getting my ATT 3G (or any "G" for that matter LOL) to work when I was trying to pull up a map. My business partner could also not pull it up on his iPad either. Could have been a bad day for AT&T, or a HUGE dead spot because we couldn't get anything for several miles. He had to resort to using the GPS on his Verizon Blackberry to get us to where we needed to be. Pretty lame since we had $1600 worth of iPads in the front seat that wouldn't work (2 64GB 3g iPads).
27 weeks ago
Also, AT&T allows simultaneous voice and data. This is huge when talking and looking something up, or when tethering.
Exactly. I also get a better FAN discount with AT&T, don't have reception issues and customer service has been good. No reason to switch.
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