iPhone hurts service, but customers stay

AT&T is once again trailing other major US carriers in its quality of service rankings, Consumer Reports has found in its latest survey (live soon; subscription required). Readers scored the network just 66 points for its performance in numerous cities, just below the declining Sprint's 67 and significantly lower than T-Mobile's 70 or Verizon's leading 75 points. Most of the criticism was leveled against AT&T's voice service, which has been widely described as unreliable as the sheer load of iPhone customers has oversaturated the 3G network.

Although last in 19 cities, the ratings are particularly low in New York City (63) and San Francisco (59), both of which have disproportionately high number of users with iPhones and other smartphones. The two urban centers have developed a reputation among these customers for frequently dropped calls as well as slow data that sometimes drops to EDGE or even GPRS. In the past several months since the most recently published study, AT&T has pledged to improve support in these and other areas by adding the 850MHz band to its 3G coverage as well as adding to the underlying network capacity.

Verizon, meanwhile, has historically been well-rated for call quality and reliability and scored above average in that field, prompting it to launch anti-AT&T ads highlighting its advantages. While Sprint escaped last place by having a better network, both it and AT&T were also hurt by perceived poor customer service where T-Mobile's average network was assisted by above average marks for customer support.

Regardless, Consumer Reports has noted that many iPhone users are less likely than any other customer, regardless of network, to leave their devices. In addition to topping satisfaction rankings, the Apple handset has developed a particularly high loyalty rate as 98 percent of American iPhone owners would buy one a second time even if forced to use AT&T again. Only 79 percent of those with other cellphones have developed a similar level of attachment.

The study appears borne out by AT&T's recent quarter, when it activated a record number of iPhones even as its turnover of old customers replaced by new ones has reached a low 1.43 percent. However, it has faced multiple lawsuits from upset iPhone buyers that have claimed AT&T and Apple misled shoppers about the performance of 3G service.

By Electronista Staff

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