ThoughtPiece: Verizon/AT&T — The U.S. Market’s Two Heavyweights

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The United States market is a critical one for RIM, giving the company about two-thirds of its revenue. Therefore it’s always good for BlackBerry fans to keep an eye on trends in this country.

While there are recognized to be 4 major nationwide carriers, the market has become stratified into a 2-tiered one. We have the first tier of AT&T and Verizon, and then we have the second tier of Sprint and T-Mobile. The second tier simply cannot compete with the first tier at this point in time. T-Mobile is too small, and Sprint is still lacking effective leadership and execution.

VerizonThe interesting battle is between AT&T and Verizon, the 2 heavyweights. Both just released their first quarter results, and they show what the last several quarters have shown: Verizon is adding new customers at a faster rate and losing existing customers at a slower rate than AT&T. Specifically, Verizon added 1.7 million net subscribers versus 1.2 million for AT&T. On churn, or customer loss, Verizon had a rate of 1.08% versus 1.7% for AT&T. Verizon has more postpaid subscribers, makes more money per customer, and takes in more total revenue than AT&T. (For reference, see the first quarter results: Verizon || AT&T .)

What is instructive is that Verizon is outperforming AT&T on virtually every key metric, in spite of the fact that Verizon is generally regarded as the carrier that is the most expensive and that is the most restrictive in terms of allowing key features on phones. AT&T also enjoys the advantage of operating on the far more widely used GSM technology versus CDMA for Verizon. Largely due to that fact, AT&T generally gets most newer, cutting edge equipment first, as those who follow the BlackBerry world surely know.

With all of these advantages in favor of AT&T, why is Verizon winning? To echo Verizon’s clichéd marketing slogan, it is simply due to Verizon’s superior network coverage and customer service. Consumers, above all, are pragmatic and just want a device that works. As the saying goes, if a cell phone cannot pick up a good signal, it is just a fancy paperweight. It will be interesting to see if the strength of the Apple iPhone release on AT&T will be enough to reverse the trends in relative subscriber growth between the two leading U.S. carriers.

I believe that RIM largely has followed the same arc as Verizon to success: appealing to the market first on reliability and stability; favoring pragmatic usability over frills. Through this they have earned an entrenched position in the enterprise market, and have established a base reputation for quality as they continue to branch out into the consumer market. In the long run this should serve RIM well.

  • James
    They don't make a rugged BB....but there is an awesome case out there for the's an Otter Box.....
  • GabrielsBugle
    SORRY . . . mispelling, I WORK in some of the most remote areas in the US, and I can tell you, VERIZON is the ONLY service which I can count on. I always know that if I ever have an emergency situation, my cell phone will work.
  • GabrielsBugle
    I have had several cellphone services, such as sprint, att, and now verizon. I would in some of the most remote areas in the US, and I can tell you, VERIZON is the ONLY service which I can count on. I always know that if I ever have an emergency situation, my cell phone will work. As for CDMA or GSM, I now own the Verizon Blackberry 8830 GLobal Phone. This will work, not only in the US but where ever either CDMA or GSM in the world. I work for GOV/ Fed Law Enforcement and my life may depend on my cell phone. "Way to go! Verizon"
  • norcalfire
    Verizon helps me because they have 24Hr customer support, where I live 4 days a week they have superior coverage. Like I said except for my work (where I am 3 days a week) they have service down the road in the town. Do I require a blackberry at work... NO it's a convience that I have to learn to live w/o when I'm there. Life is give and take and if I have to give while I'm at work but take when I'm home it pays off. I should mention I'm not a world travler either so that doesn't bother me. They have 3G which makes browsing larger web sites on my blackberry a little more enjoyable and less time consuming. I'm not looking for an arguement and everyone has different experiences I'm just stating mine.
  • hell no
    Please enlighten us how 3G helps YOU with your blackberry? Whats that? verizon doesn't have service where you work? verizon's closed, proprietary, anti-consumer, network which is not available around the globe, OR at your place of work and you have to suffer with 2 generation old RIM devices? More magic....
  • Norcalfire
    I'll tell you why I'll stick with Verizon even if I can't have my blackberry with a camera and what not. Because VERIZON's blackberrys are 3G. I'm not going to pay more money for EDGE and not get 3G. Maybe if they had wifi. BUt no. ALthough the one perk of Cingy is that where I work (the sticks) they do get service in 1 spot out back w/o having to go in to town like verizon does. NOTE I WORK IN THE BOONIES.
  • hell no
    Good to hear BBCool staff are IN THE KNOW, and don't let verizon, cdma and all it's issues hold y'all back.
  • Hell No,

    We appreciate your commentary, and your desire to keep us honest. However, I feel we should mention that, although Thought rocks Verizon, the rest of the BBCool staff uses Rogers -- a CANADIAN GSM CARRIER.

    Love the debate, though, guys. Let's keep it going.
  • hell no
    BTW the "ThoughtPiece: Verizon/AT&T — The U.S. Market’s Two Heavyweights" is so full of bias and un-truth's it's shameful. Too bad those at BlackberryCool time after time can't leave personal fantasy's of verizon alone in fantasy world, and keep whining for the day (that will never come) when RIM or any other manufacture takes verizon and cdma seriously. Global wireless subscribers numbers tell the tale why. GSM is growing, cdma is falling.
  • hell no
    verizon's anti-consumer culture, and dead end cdma network WILL be verizon's downfall. No top tier handset manufacture makes devices for cdma, and even if they did verizon would lock them down and cripple functions and applications. att uses GSM, which is the Global System for Mobile Communication, it's a non-proprietary, open standard. Every manufacture makes GSM phones.

    verizon - closed, proprietary, anti-consumer, network not available around the globe. verizon like being anti-consumer is also anti-union. qualcomm's holding verizon's leash.

    att - open, non-proprietary, pro-consumer, using technology and devices which works around the globe. att is Pro-UNION.

    Cheerleading aside att's network is as good if not better than verizon's around the US. Its sad that vealot's are stuck on believeing everything that comes out of verizon's hole.

    A tale of two companies....
  • Bob
    I used to be a Verizon customer but left due to the fact that I could not even make or receive a call in my house in a very well populated Chicago suburb. My daughter had the same issue at her house. Some network. I love my T-Mobile Blackberry.
  • TimmyH
    But the risk now for RIM is that they leave the door open in the Enterprise space.

    They really need a more rugged BlackBerry for field workers - and can they really make devices to match the range of Windows Mobile devices for niche markets.
  • Thought
    Thanks again for everyone's great comments; it's an honor.

    To "bleh": I will admit a bias...towards what I consider to be the superior product. I do admit to using Verizon service, as does my employer...but I don't think that indicates bias, only consistency in my personal choices with my analysis.

    Plus, all commentary/analysis columns such as mine have their own point of view. As a rhetoric professor of mine once told us, all of learning is slant, is a bias, is influenced by opinion.

    I don't own any interest in Verizon, nor am I an employee...then I might be accused of some form of unfair bias....notice the inclusion of the word "unfair", as in having an ulterior motive.

    But it really doesn't matter what my own personal preferences are...that's why I cite the financial numbers. The numbers don't lie; they clearly indicate a trend among American consumers. I merely note that trend.

    Once again, thanks for everyone's comments...please keep 'em coming.
  • aviationwiz
    It may read like a Verizon commercial, but it's all true.
  • jason
    i have had both...verizon, in my area, is by far a better carrier when it comes to reception and customer service.
  • Bleh
    Bleh, this reads like a Verizon commercial, thanks :P

    $10 says the author has Verizon phone/data service, this article smacks of bias.
  • Robb (RIMarkable)
    Verizon's network just works.
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