“He explained at a JP Morgan conference that 70 percent of all of AT&T’s customers are on family plans, which are difficult to transition wholesale to another carrier due to multiple devices,” Electronista reports. “About 40 percent of subscribers have corporate plans that employers wouldn’t necessarily be willing to switch over to another carrier.”
Electronista reports, “The executive didn’t go so far as to indicate that AT&T’s exclusivity period for the iPhone was ending… De la Vega himself was enthused with the iPad, saying he was ‘addicted’ to it and that it had ‘changed the way [he] work[s].'”
Full article here.
At last count I am personally responsible for 9 people purchasing an iPhone. Some switched from Verizon to get it. None of these people planning on moving to Verizon if/when it becomes available.
AT&T;chief (is paid well to say he) doesn’t see mass exodus to Verizon iPhone
Good job AT&T;, lock those people in.
However, I will stick with you because I like being able to talk and use the internet with my iPhone…..something that seems impossible on Verizon
In other words…. We at AT&T;have erected walls in a delightful way for us to retain customers. Unless those customers are willing to endure financial hardship, we got ’em.
On a side note,I have to say AT&T;has been fine for me. I have no issues. Maybe 1 dropped call a month. Although I do know people for whom the opposite is true.
If there were a mass exdous to Verizon, I think I’d stick with AT&T;because things would be getting better on this side and worse for Verizon because I don’t think their network could handle that kind of massive data growth. If that does happen, I welcome that.
We have four people on our AT&T;family plan and are actually going to hold off on buying the new AT&T;iphones this summer so that we can switch back to Verizon when the Verizon iphone comes out. We are sick of all the dropped calls. Even if higher iphone traffic brings dropped calls to Verizon it couldn’t be any worse than AT&T;is now..
I may be responsible for selling one of the first Verizon iPhones when they become available; my mother-in-law is on Verizon and it would cost too much to switch, but she definitely wants an iPhone if they come to Verizon.
Dude’s probably right; not going to get that many switchers except maybe for those at the tail end of their contracts, if Verizon offers some decent incentives.
Not only that, but markets, like here in Houston, AT&T;has pretty good coverage.
Count me as someone who does not plan to switch back, as well as the rest of my family… There is 7 people right there. The reasons we won’t switch back?
1. Cost of the plans, Verizon is more expensive for the same thing
2. Still no Internet and phone at the same time
3. Most importantly, Verizon’s horrible customer service!
I doubt that many would leave ATT — just people who are *realy* frustrated, probably those in NY or SF. But it would stop a lot of people from switching *TO* ATT, and that means a big loss for the company over time.
AT&T;has provided us good quality 3G coverage in the Texas Hill Country since September ’09.
Forgot to add:
4. Verizon likes to nickel and dime for EVERYTHING! I got tired of that a loooooong time ago.
If I were Mr. de la Vega, I would give Apple anything they want to keep the iPhone as an exclusive indefinitely. If he thinks people will not patiently wait for their chance to chance carriers and be treated a little less worse, he is deeply deluded. AT&T;is on the map because of the iPhone, and now the iPad.
Let us ask, if Apple got hold of bandwidth, and created an Apple model for cell service, who wouldn’t want to sign up? Even without the iPhone Apple’s approach would bring people to them, rather than trying to lock them in and tie them up. Blackberry succeeded, in my opinion, by trying to push a customer’s needs into a cell phone package. Added services, added features, and people loved it. Apple went so much further, and of course, people loved it.
Am I on AT&T;for their service? LOL! I am at AT&T;solely because of the iPhone. THAT is where my loyalty goes, and as I said, if I was de la Vega, I’d take a big sip of reality juice, and offer Apple anything they wanted to keep the iPhone indefinitely.
I’m sure there will be some exits if a Verizon iPhone appears, but I doubt it would be massive.
I forget, wasn’t there a CEO that claimed there would be *zero* iPhone users after his “killer” phone came out? That was delusional.
So the only reason he gives for people NOT switching to Verizon is basically becuz ATT has people cornered in ?
If that is the case, I hope ATT is waking up and smelling the fact that something needs to get fixed….. like where the heck is the tethering they promised ?
I probably would be one to stay with ATT…. but I have had my days/months/years where I also get so frustrated with them that I want to switch….. they need to start treating (U.S.) iPhone owners AS the customers they are…. verses iPhone owners with no choice but ATT (unless they give up the iPhone – which is not a choice really)…..
The attitude of “You should be glad you have ATT to connect your iPhone to” needs to be wiped from their VP’s phrase book.
I won’t switch from ATT to Verizon, since I’m one of those people who thinks that Verizon’s customer service, coverage, and pricing models are vastly inferior to ATT. And, since I travel internationally, Verizon is an absolute no-go for most business people who actually have a passport.
Nevertheless, is this a tacit admission that a Verizon phone is coming? I read his comments, and why would he make such a bold statement unless he assumes/knows/supposes that there will be a Verizon phone. Personally, if Verizon does get the iPhone, and I remain fairly skeptical, it will bring more customers to Apple, not a lot of “switchers.” For Apple, a customer that switches has little value, because it’s merely a transfer from one iPhone to another, rather than an added iPhone.
For example, when the iPhone 4 comes out, a large percentage of ATT customers will upgrade. If some of those switch to Verizon, then it’s just a horizontal move by the customer, bringing no additional incremental revenue to Apple. So, Apple will want ATT customers to remain (and grow in numbers), while creating a vast swath of new customers through Verizon (incremental sales). I’m sure there will be some amount of switching, but only a small amount.
I remain skeptical because I am not convinced of the business case for a CDMA phone. It’ll require additional software, hardware (my guess is that a Verizon iPhone will work domestically on CDMA but internationally on GSM, doubling the costs of that part of the phone), and support technology within Apple. What if the GSM version has a 50% gross margin, but the CDMA version only a 45% gross margin? That’s not going to look good on Apple’s sacrosanct bottom line.
For most customers, and not obsessive geeks like us, ATT is just fine. I get dropped calls, but so rarely as to be just acceptable, not even slightly annoying. 3G data services seem to be improving (last summer I was getting 500-750 kbps speed, now I’m in the 1500 range). I get international, seamless service. The cost is reasonable. My whole family is on an iPhone plan. I know there’s a bunch of ridiculous urban myths about Verizon’s service, but in reality, it’s just that, an urban myth. And your own experience means precisely nothing in a data analysis.
I am not unique. I let my contract expire. Iam month to month on a family plan with five phones. More and more cellphone customers have gone off-contract. Switching carriers is no big deal.
The time is at hand. Sometime in the next month of so, I will decide between the 4G iPhone on AT&T;, the 4G iPhone on Verizon or Sprint, or the EVO on Sprint.
My decision will be based mostly on monthly plan cost with tethering. Up-front cost is not that important, as I expect all phones to be similarly priced after incentives and rebates.
Let’s put the carriers on notice, we are not as captive as they hope. Carriers must be competitive to retain or grow customers.
One word will change to whole game “tethering”. If Verizon has that, good-bye AT&T;.
just my $0.02
I’ll evaluate my options in 2012 when I’m ready to replace my 3GS.
I noted that all of the reasons he cites are about difficulties moving and none are about AT&T;service being superior. Customer service and value are how you keep customers.
What the hell is he supposed to say? The truth? To a bunch of investors? This is a non story!
LeftCoastDude:
Your math doesn’t compute. If an AT&T iPhone owner switches to Verizon, he is buying ANOTHER iPhone. That old phone either remains on AT&T (sold on eBay/CraigsList), ends up overseas (unlocked), or (least likely) is relegated to iPod duty. Either way, each existing iPhone owner who switches to any possible future Verizon phone would be buying a whole new iPhone, at FULL price (full to Apple, that is; the customer would likely get Verizon’s subsidy, though).
tomL:
Letting a contract expire and continuing to pay the existing plan is essentially like giving free money to your carrier. Your monthly plan includes a subsidy portion, which pays of your phone. When you get a free-with-plan Nokia, your plan includes some $12 that, over some 15-18 months pays of the retail price of that phone. Once you’ve paid it off, you are giving a monthly gift of around $12 to AT&T. In case of the iPhone, the subsidy is known to be much higher (approximately $420). Spread over those 18 months (which is the time after which you can get a new subsidised phone), makes it to $24 per month.
So, all of you who have iPhones, and didn’t get the next one immediately after their ‘eligibility to upgrade’ date, are you enjoying donating $24 per month to AT&T? Is it really a worthwhile charity?
Until you can take your iPhone with you and it’ll work on Verizon’s network, there will not be a big exodus of iPhone users from AT&T.
New iPhone users will get a CDMA iPhone with Verizon if Verizon’s coverage works for them and they can still use iTunes for their Apps, Movies, Music and syncing. You never know what BS Verizon will pull.
Even if the iPhone does become available on Verizon, I won’t be switching either. While AT&T;has it’s issues, I’ve been far more satisfied with their service than I ever was back when I was with Verizon in the past.
Most normal users don’t even know what “tethering” is. There’s this minority of folks (ie:EGGHEADS) who bitch loudly because they can’t tether, or because they have substandard AT&T;service and somehow that’s made to seem like average Joe and Mary using their iPhones without issue.
I’ve barely had any issues with AT&T;. It works fine for me. It works fine for a lot of folks. Verizon is a downright shitty company (take it from someone who gets phone, Internet and TV from them). Their customer service is absolutely awful. AT&T;has helped me each and every time I’ve called, and without hassle. Verizon I’m on hold a LOOOONG time and then get the run around.
Boiled down, the question is this: Is the deal with At&t;worth more or less than the almost instant revenue generated by the millions of current Verizon customers who would immediately buy an iPhone if it was available?
Millions of instant iPhone sales has to be a very large bargaining chip for Apple to leverage against At&t;.