I think this is a bit of wishful thinking, sort of like Microsoft Kinect outselling the iPad, but the idea of Verizon causing that kind of consumer bleeding of AT&T’s current locked in iPhone users sure has caught the fancy of a lot of pundit.
The idea that the iPhone of the Verizon network could cost AT&T upward of 1.4 million customers is being floated by the analysts at Credit Suisse from a survey they ran recently. The survey seems to indicate that 23% of AT&T iPhone users would switch to Verizon should the Jesus Phone ever make the switch.
Credit Suisse estimates that AT&T’s net new subscriptions will be about flat for 2011 as users flock to Verizon and other carriers when AT&T’s iPhone exclusivity expires, versus an expect 1.5 to 2 million new subscriptions by a consensus of analyst estimates. The rate at which subscribers leave AT&T will also go up slightly in 2011, to about 1.3 percent compared to 1.1 percent in 2010, according to the Credit Suisse report.
According to Credit Suisse, Verizon’s subscriptions will increase sharply next year, doubling to about 4 million new subscribers from 2 million in 2010; that’s significantly higher than the 1.5 million new subscribers projected by a number of analysts to date. The cost per new user will go up as a result of the iPhone’s presence, putting some pressure on earnings in 2011 — but that will snap back in 2012, according to the report. Credit Suisse’s earnings-per-share estimates for Verizon are about 12 percent lower than consensus estimates.
I am sure that Verizon would see an almost immediate flood of users looking to dump their AT&T contracts but 1.4 million of them? That might be a bit of wishful thinking.