Gird yourself for the Verizon iPhone stampede — not

January 17, 2011

Screen shot 2011-01-17 at 12.15.45 AM

Considering the frustration AT&T’s iPhone customers have vented since nearly the first day the wireless company became the exclusive carrier for Apple’s revolutionary smartphone, you might think that we’ll be seeing lines outside Verizon stores, saturation media coverage and another appearance from Greg “First In Line Guy” Packer.

But for the seemingly sizable demographic that is iPhone lover and AT&T hater, long-suffering souls for whom having an alternative to AT&T seemed an impossible dream, February 10 may not be so much “Independence Day” as, “Yeah, Well, Maybe Next Year” Day. If that.

There are mundane reasons why we won’t see the sort of stampede suggested by a ChangeWave poll, to which 26 percent of iPhone customers said they plan to switch to Verizon, and 16 percent of all AT&T subscribers say they’ll switch because of the Verizon iPhone. Let’s start with contracts that impose onerous early termination fees and the family plans which multiply their cost. Nothing disperses an angry virtual mob like what it costs to stay in one.

But, there are bigger forces at work. Call it a granular definition of self-interest.

Even mobile number portability didn’t spark much churn. When your phone number was no longer a potential hostage, guess what? The telcos adapted, with other sticks and new carrots. As someone who once did port his number, and who also has been an iPhone user since day one, permit me to testify that iPhone liberation is a considerably less disruptive force.

Competition is an amazing thing. It requires former monopolists to radically switch gears. AT&T knows this well. Its 1982 breakup smoothed the way to probably every single telco innovation you can name. But rather than wither and die, AT&T became the sole U.S. proprietor of the iPhone, the most important handset since the first commercially viable cell phone.

In the coming months, as contracts expire, look for price wars and capitulation by AT&T on some important side matters — things like using your phone as a genuine HotSpot and an end to the monthly fee they charge for the right to share with yourself, on your tablet and laptop, the limited data you have already purchased. And that you can still make and receive calls while it is doling out broadband.

Look also for arguments that defections will make AT&T’s network better for the rest of us. Watch for repeated reminders that Apple is likely to release a new iPhone in July, as it has done in every previous year — so what’s your hurry, anyway? Listen for AT&T to emphasize that its GSM iPhone can be used overseas, unlike Verizon’s CDMA version.

And then there is the “Who Needs An iPhone Anyway?” argument. The iPhone in 2010 isn’t nearly as revolutionary as it was in 2007. It spurred plenty of copycats and woke the sleeping giant that had been Google, whose competing Android mobile phone operating system will surpass the Apple iOS market share in just a matter of time. Android devotees are as passionate as Apple, and they have reason to be.

Verizon’s entry represents a mainstreaming of the iPhone just as a new paradigm seems to be shaping up, perhaps even ushering a day when we dumb down our mobile phones because our main portable is a tablet. In the meantime, leveraging the colossal name recognition that is “iPhone” should make millions of Verizon customers, who wouldn’t have otherwise, suddenly start thinking about joining the smartphone set.

Verizon’s big pickup stands to be among people who wouldn’t think of leaving a company just to get a certain phone — not people who would, just to dump a certain carrier. The major gene pool will be customers who upgrade as their contracts expire (a condition Verizon can manipulate if it so chooses), from “Hey, why not us?” pitches to new customers, and from non-iPhone users who have been reluctant to go to AT&T.

But it won’t happen overnight.

Image: Verizon Wireless

9 comments

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Nonsense! The stampede might not be as big as when the IPhone 4 came out but it will certainly be larger than for any other phone and it will be very large. The only thing that could hold it back is if Verizon gets greedy with their data charge.

Posted by AlG | Report as abusive

Second of October 2011? Oh, that’s right, the date doesn’t work overseas either…

Posted by nicfulton | Report as abusive

You are right; there will not be long lines. It will just be a steady stream of people buying the iPhone from Verizon. And Android will be the victim in this, not AT&T. Verizon users will finally have the opportunity to purchase a great phone.

Posted by RufusDaddy | Report as abusive

You’re assuming the only audience for the new iPhone is former iPhone customers. Not even close. There are plenty of current Verizon customers who will make the switch, as well as customers of other carriers, and some who will jump into the smartphpone world for the first time. Verizon isn’t just splitting the AT&T pie; they’re making a second, larger and arguably more appealing pie.

Posted by KelliLake | Report as abusive

Nice article, but I disagree on some aspects.

The Iphone has dominated every carrier where both Apple and Google products are available. It is a only a matter of time before Verizon becomes primarily an Iphone provider, like AT&T. Google’s Android operating system while open source in nature, still fails to outsell the Iphone where both are available.

Posted by nkrebs | Report as abusive

I’m sticking with U.S. Cellular! They were rated #1 by consumer reports in the wireless industry. And they’ve earned 10 J.D. Power Awards! I’m not tempted by the iphone one bit, I’ll stick with a carrier I can truly rely on.

Posted by thrive31 | Report as abusive

Total market share of android devices vs iPhones means that there are more of one type of device being sold. In Asia iPhones are sold by every carrier unlocked and are the biggest selling single phone, yet you will almost always see more android devices out and about.

Posted by djlowballer | Report as abusive

You need to polish your crystal ball. Verizon breaks record phone sales on a single day; over 500,000 iPhone orders.

I guess there was a stampede of customers that wanted to have an iPhone AND have great phone reception instead of jumping to the carrier with the WORST customer satisfaction ratings in the industry.

Posted by Diamond_Dave | Report as abusive

@Diamond_Dave. Maybe!

Oh, apropos of nothing, you may want to read this:
http://news.cnet.com/8301-30686_3-200312 76-266.html?tag=TOCcarouselMain.0

My favorite parts are:

“New York 8:15 a.m. ET I apologize for not updating this blog more frequently. It’s about 20 degrees in New York City. And my fingers have been so cold that I wasn’t able to type for very long. Also, as I mentioned there were only a handful of people in line at the store (ed: eight, count’em, eight), so there wasn’t much to report.”

and

“San Francisco 6:40 a.m. PT: Well, here at the flagship Apple Store in San Francisco, you’d have to say it’s not just cold weather that’s keeping people from lining up to buy the Verizon iPhone. Upon arriving here about five minutes (before the 7 a.m. opening of the store), there were literally more Apple Store employees, police officers and reporters — each — than people in line to buy iPhones.”

Posted by johncabell | Report as abusive