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Verizon “pre-churners” snub Palm, look to iPhone

Wed, 08/12/2009 - 8:10am
Andrew Berg, Wireless Week

Recent analytics from online behavioral research company Compete.com show that Verizon Wireless may not see quite the boost some expect from a forthcoming Palm Pre launch on its network.

Elaine Warner, director of consumer technologies for Compete, took a look at which wireless customers were “shopping around” for a device not offered by their current carrier – for example, a customer on Verizon Wireless who might be shopping for the Palm Pre over at Sprint. Warner calls these customers with wandering eyes “pre-churners” and identifies them by their having accumulated 10 or more page views per month on a competitive carrier’s Web site.

"There’s been this question of could this device do better on Verizon or AT&T?" Warner says.

At first glance, it appeared that Verizon customers were either satisfied with their current network or simply not interested in the Palm Pre. In fact, only 1.7 percent of Verizon pre-churners were interested in the Pre, suggesting that bringing the Pre to the carrier won’t actually help it retain some of its riskiest customers.

While that was all good and fine, Warner took things a step further, wondering how many Verizon Wireless customers might be exhibiting pre-churner behavior with a hankering for AT&T’s iPhone 3G S.

According to Warner’s data, a whopping 14.8 percent of Verizon Wireless’ pre-churners were checking out their Apple-branded options over at AT&T, specifically the iPhone 3G S (surprise, surprise). That’s 40 percent higher than that of pre-churners from Sprint or T-Mobile USA.

“I think that suggests Verizon might still have something to worry about in the iPhone,” Warner concludes.

But is Verizon really losing sleep over the possibility of iPhone churn? As it stands, Verizon Wireless, sans a truly iconic device in its portfolio, is holding up extremely well against its closest rival, AT&T Mobility. The two carriers’ churn rates are in line, and differences in current subscriber numbers are relatively negligible.

Meanwhile, Verizon is at the center of the most recent flood of device rumors. Rumors, it should be said, that are inching ever closer to confirmed by the watchful eyes in the blogosphere. Central to those rumors are a data-only device from Apple (the tablet), the Palm Pre in early 2010 and, of course, the possible arrival of a CDMA version of the iPhone. But rumors can sometimes be just as powerful as the truth in an industry accustomed to monumental changes occurring overnight.

Just yesterday, UBS downgraded Research In Motion (RIM) from “Buy” to “Neutral.” In research notes, UBS analyst Maynard Um wrote that, “although we don’t expect a Verizon Wireless iPhone launch this/next year (though another operator in 2010 is possible), we believe it could prove to be a sentiment headwind.”

To be sure, nothing will be clear until one of these high-profile devices finds itself a launch with Verizon. It’s always possible that many of those iPhone-hungry pre-churners are just window shopping, awaiting what they see as inevitable – the coming of an iPhone to CDMA turf.

More Broadband Direct 08/12/09:
•  Clearwire gives rosy outlook despite slowdown
•  Post FCC waiver, Evolution scores customer win
•  RGB Networks adds MPEG-4 to bandwidth manager
•  Rovi, TNS Media team up on TV, STB measurement
•  Verizon adds remote DVR, multimedia features for FiOS subs
•  Survey: Companies reprioritizing IT needs
•  Signs of life in North American broadband market
•  Verizon "pre-churners" snub Palm, look to iPhone
•  Microsoft, Nokia team up for enterprise endeavor
•  Broadband Briefs for 08/12/09

 

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