AT&T holds lead in new customers; Verizon still tops in satisfaction

By Paul Carton
November 12, 2008

Can you hear me now?

Apparently yes - if you are one of the two leading cellular service providers.

In September, we conducted a consumer survey on cellular service provider trends, and took a closer look at what is now clearly a two-horse race for leadership of the industry between AT&T (T) and Verizon (VZ).

A total of 2,883 members of the ChangeWave Research Network participated.

In the hotly contested battle for current market share among cell phone owners, AT&T (30%; unchanged) holds a slight market share lead over Verizon (29%; unchanged).

Verizon, however, is still the clear favorite in terms of customer satisfaction.

Currently, 43% say they are Very Satisfied with Verizon's service. AT&T (29%) is a distant second, followed by T-Mobile (24%) and Sprint/Nextel (S; 20%).

The Fight for Future Share

Looking ahead, respondents appear less likely to change cellular service providers over the next six months. Only 12% said they are either very, or somewhat, likely to switch providers. That number is down from 18% in our June 2008 survey.

So, who is making a switch?

While only 6% of current AT&T customers say they're likely to change providers - the lowest percentage ever recorded for AT&T in a ChangeWave survey - Verizon is a different story. Here we found 11% of Verizon customers saying they're likely to switch, along with 18% of T-Mobile and 19% of Sprint/Nextel's customers.

And who are they switching to?

A total of 31% of likely switchers are headed to AT&T, down 1-pt from the previous survey. Another 19% say they'll choose Verizon as their new cellular service provider, down 3-pts.

The movement toward AT&T is undoubtedly due to the growth in popularity of the Apple (AAPL) iPhone 3G, which uses AT&T as its exclusive cellular service provider.

We note that T-Mobile (7%; up 3-pts) is also showing improvement in market share among those planning to switch.

Dropped Calls

We also asked respondents how frequently they are experiencing the frustration of "dropped calls" - and we have a clear winner among service providers.

Verizon subscribers reported that on average, just 2.7% of their calls were "dropped" over the past 90 days, well below the average of its competitors.

Importantly, one-in-five Verizon users say they haven't experience any dropped calls over the past three months, the highest in the industry.

AT&T (3.6%) ranked second best in terms of percentage of dropped calls over the past three months, while Sprint/Nextel (4.4%) and T-Mobile (4.5%) bring up the rear.

The ChangeWave survey results show that the struggle for cellular service provider supremacy is now a two-horse race between AT&T and Verizon. It doesn't get much louder or clearer than that.

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Jim Woods co-wrote this article.