Europe Shows Why Verizon IPhone May Help AT&T Fortunes
Critics have waited for years for someone to challenge AT&T’s stranglehold over the iPhone, but despite predictions that millions could defect to Verizon next month now that it can sell the iconic handset, history actually suggests that losing exclusivity could help AT&T rather than hurt it.
By Bobbie Johnson, GigaOMWith Verizon finally confirming the news that it is going to start selling the iPhone, there are plenty of eyes watching AT&T to see what happens. Will hordes of exasperated subscribers cancel their contracts and switch? Given some of the criticism of AT&T’s network, it’s not hard to imagine an exodus. That pessimistic view of AT&T’s chances is given a big push by this survey by ChangeWave, which must count as one of the most drastic predictions of the impact Verizon selling the iPhone will have on the market. According to the numbers, a full 16 per cent of AT&T users intend to switch to Verizon as soon as it starts selling the iPhone. (It’s worth noting, too, that this question was asked before the February launch was confirmed, so it would be reasonable to suggest the numbers could be even higher now.) So what does that mean for AT&T? Panic stations? Perhaps not. In fact, prior experience suggests that the Verizon iPhone will almost certainly going to have a smaller impact on AT&T’s sales figures than ChangeWave’s research suggests. Why? Well, for a start, there’s the significant difference between somebody saying they’ll switch providers and those actually doing it. Then there are the mitigating factors that also make a difference: coverage, contract expiration dates, termination fees and other obstacles. With all that taken into account, Kevin’s smart analysis of the impact, suggests there may as many as one or two million switchers out there. But there’s another important factor worth remembering too: This isn’t a zero-sum game. To find out what I mean, it’s worth taking a look across the Atlantic to see what happened when the iPhone lost its exclusivity in the UK.