Mar 25, 2011 (10:03 AM EDT)
AT&T iPhone Defectors Paid Fees To Join Verizon
Read the Original Article at InformationWeek
Verizon began selling the iPhone on Feb. 10, more than three and a half years after AT&T did. Starting in June 2007, AT&T was the lone U.S. seller of the popular phone from Apple. Over the years, as the iPhone's popularity surged, AT&T's network took on some serious strain. iPhone users complained, loudly, about network problems, dropped calls, and so on.
If only the iPhone were made for Verizon's network -- which has a better reputation -- people thought. Some swore they'd give anything for a Verizon iPhone. They got their wish, and give they did.
A survey of iPhone users conducted by Mobclix in February produced some interesting results. Here's what Mobclix found:
-- Top cities with highest Verizon iPhone usage across the Mobclix Exchange: San Francisco, Los Angeles, Seattle, Chicago, New York, and Boston.
This makes sense. These six metro areas have high population densities. AT&T customers located in New York and San Francisco, in particular, complained heavily about AT&T network problems over the years.
-- AT&T iPhone owners use Wi-Fi an average of 53% of the time vs. 38% for Verizon iPhone owners.
This metric implies that AT&T's iPhone users needed Wi-Fi to substitute for the poor quality of AT&T's network. I say it's a little too early to give this metric much weight. The iPhone has only been available from Verizon for about 6 weeks. More Verizon iPhone customers may start to use Wi-Fi once they determine that it's faster than Verizon's 3G network.
AT&T has responded to this particular aspect of the Mobclix study and their argument makes sense on the surface. AT&T said, "For the wi-fi nugget - there’s a major piece of context missing – that we operate the nation’s largest Wi-Fi network with over 24,000 AT&T Wi-Fi Hot Spots nationwide. And many of the most popular AT&T smartphones – including iPhone – support auto-authentication, making it automatic and convenient for customers to connect to Hot Spots or our new hotzones (like the ones in Times Square and the Embarcadero) without it counting toward their monthly smartphone data usage." Mobclix didn't provide quite enough information about this particular question to make it a useful bit of knowledge.
-- 2 in 3 AT&T iPhone owners who switched to Verizon iPhone paid the early termination fee.
This is the money quote. This tells you just how desperate AT&T iPhone users were to ditch the AT&T network in favor of Verizon's network. ETFs range between $175 and $350 depending on the device, carrier, and status of the user's contract. Surely, some gave AT&T $200 or more in order to escape what they thought was bad service.
-- The top 3 reasons for iPhone owners making the switch to Verizon are: reception issues, personal hot spot, and reputation.
I'll give AT&T-to-Verizon switchers credit for the reception issue. Based my own experience with both carriers over a number of years, Verizon's reception is typically better. The personal hot spot is a silly reason to switch, as AT&T offers it, too. Reputation? Hmm, well, I guess whatever excuse they needed to tell themselves to avoid feeling remorse over paying that ETF.
-- 14% of U.S. iPhone 4 users are on the Verizon Network, and they account for 4% of total worldwide iPhone users.
In the first month of availability, one in seven U.S. users of the iPhone 4 are doing so on Verizon's network. That's a lot, considering the sheer volume of iPhone 4 users who are doing so on AT&T and other networks. It will be interesting to see just how these percentages ebb and flow over time as new models of the iPhone are announced for different carriers and with different cellular technologies inside.