According to Credit Suisse analyst Jonathan Chaplin, AT&T doesn’t need to worry about the long-rumored, but yet-to-launch Verizon iPhone. Based on survey data, he found that only 23% of AT&T iPhone users would switch to Verizon, and, perhaps more shockingly, 51% of subscribers reported satisfaction with AT&T’s service.
As a result of this new data, the analyst firm upgraded AT&T’s stock from “Neutral” to “Outperform” (a buy rating) noting that the stock would retain its position even if Verizon gets the iPhone next year, as many industry insiders expect.
The main issue preventing AT&T subscribers from making the jump from one carrier to the next could be the contract termination fees, as only 3% of potential switchers said they would be willing to pay the fee to move to another company. (In addition to the 23% that would switch to Verizon, 3% would go to Sprint, 2% to T-Mobile.)
As for iPhone users in particular, Credit Suisse found that only 18% would leave AT&T when their contract expired – that is, sans termination fee. While that’s more than the 9% of AT&T’s subscriber base who plan on switching when their contract is up, it’s still a lower number than many would have expected.
Chaplin determined that the AT&T exodus to Verizon would end up costing the network around 1.4 million subscribers, while boosting Verizon’s new subscriber count from 2 to 4 million – this assuming, of course, that the mythical Verizon iPhone turns out to be real.
AT&T iPhone Satisfaction: Not as Horrible as We Thought
Meanwhile, iPhone users are slightly less satisfied with AT&T’s service overall than the subscriber base as a whole: 51% of AT&T users are satisfied with the service, but only 42% of iPhone users feel the same. However, that’s still a much higher number than previously imagined.
In fact, this data seems somewhat in opposition to the market research data released just last month from Morspace. According to their survey of 1,000 customers, 34% of AT&T iPhone owners are waiting for the iPhone to become available on another carrier before upgrading their handset, and 47% are considering switching to Verizon. When technology news site TechCrunch reported this news, it said: “When AT&T’s monopoly on the iPhone ends… it’s not going to be pretty.”
But which is it? Forty seven percent of iPhone owners will go to Verizon? Or only 23%?
For what it’s worth, Credit Suisse isn’t the only firm to upgrade AT&T’s stock as of late. MarketWatch also noted that Deutsche Bank analyst Brett Feldman upped shares to a buy rating in July, saying that concerns about the potential loss of iPhone exclusivity have been “overblown.”
At the moment, all this news is much to-do about nothing, given that the Verizon iPhone exists only as a rumor, not as an official proclamation from Apple. That being said, it’s still somewhat startling the number of everyday people I encounter who have taken the rumor to heart, telling me they’re “waiting for the iPhone to come to Verizon” before getting one. The rumor has been around long enough that people believe it’s a tried-and-true fact.
We’ll have to wait until next year to see if that’s actually true.
