updated 01:10 pm EDT, Tue September 21, 2010
ATT downplays iPhone non-exclusive again
AT&T chief Randall Stephenson talked down the impending loss of iPhone exclusivity again today at the Goldman Sachs Communacopia conference in New York City. The executive this time focused on loyalty and noted that about two thirds of iPhone owners had already been long-term AT&T users before they signed up. Many of these are unlikely to switch away, he claimed.
He also hinted at big sales and mentioned that there was a "record number" of subscribers upgrading to the iPhone 4 this summer. These would be locked into an extended contract that would make it difficult to switch, Stephenson said. The statements also gave an opportunity to reiterate beliefs that corporate and family plans would save AT&T, as 80 percent are in non-individual plans that are costlier or more impractical to leave.
Device mix was important. Apple had set the tone for smartphones with the iPhone, but there's now an "extended array" of smartphones to pick from, according to the CEO. Stephenson pointed to the iPhone 4 and Samsung Captivate as some of the biggest drivers, but he went against statements by the company's Western regional president Fred Devereux on disappointing Torch sales by claiming that AT&T was "really pleased" with the new BlackBerry.
While outwardly confident, the statements reflect an increasing defensive posture at AT&T that has been widely interpreted as knowledge that its period of exclusivity with the iPhone is coming to an end and runs against customer reactions. Unofficial studies have shown that almost a quarter would jump to Verizon once an iPhone was available on the network, with a small percentage also willing to switch to Sprint or T-Mobile. Most expect large-scale defection in New York City and San Francisco, where AT&T's burdened 3G network has sometimes made the iPhone unusable for 3G.
A CDMA iPhone is believed to be in development and could soon go into production for a launch as soon as early 2011, when AT&T's exclusive is thought to end.