Can You Hear Me Now?

By Paul Carton and Jim Woods

In September, we surveyed 2,883 ChangeWave Research Network members on cellular service provider trends, and took a closer look at what is now a two-horse race for industry leadership between AT&T (T) and Verizon (VZ).

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

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



Forty-three percent said they are very satisfied with Verizon's service. AT&T is a distant second with 29%, followed by T-Mobile with 24%, and Sprint/Nextel (S) with 20%.

The Fight for Future Share

Looking ahead, respondents appear less likely to change cellular service providers during 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?

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While only 6% of current AT&T customers said they're likely to change providers -- the lowest percentage ever recorded for AT&T in a ChangeWave survey -- Verizon is a different story.

We found that 11% of Verizon customers said they're likely to switch, along with 18% of T-Mobile and 19% of Sprint/Nextel's customers.

And who are they switching to?

Thirty-one percent of likely switchers are headed to AT&T -- down one point from the previous survey. Another 19% said they'll choose Verizon as their new cellular service provider -- down three points.



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 (up three points to 7%) is also showing improvement in market share among those planning to switch.

Dropped Calls

We also asked respondents how frequently they experienced "dropped calls," and a clear winner among service providers emerged.

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

And 1-in-5 Verizon users said they haven't experience any dropped calls during the past three months -- the highest in the industry.



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

The ChangeWave survey results are loud and clear: The struggle for cellular service provider supremacy is now a two-horse race between AT&T and Verizon.

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Paul Carton is the Director of Research for the ChangeWave Alliance Research Network. Jim Woods is a Senior Editor for ChangeWave. The Research Network is a group of 20,000 highly qualified business, technology and medical professionals -- as well as early adopter consumers -- who work in leading companies of select industries. ChangeWave surveys its Network members weekly on a range of business and consumer topics, and converts the information into a series of proprietary quantitative and qualitative reports.

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