One-Fourth of First-Time Smartphone Buyers Want to Change Carriers

The price war over data and voice costs among U.S. carriers is having an impact on first-time smartphone buyers.

The price war over data and voice costs among U.S. carriers is having an impact on first-time smartphone buyers.

For phone customers planning to buy their first smartphone in the next year, 26% said they plan to change to another carrier, according to a survey released by Kantar Worldpanel ComTech on Wednesday. Another 44% said they might change carriers.

Kantar relied on online questionnaires for the survey, conducted in the first quarter of 2014, and reaching as many as 20,000 consumers each month.

"The quest for cheaper calls and lower data plans is driving the need for change" to another carrier, the analyst firm said in a statement.

T-Mobile has been driving much of the low-price pressure in the market, along with no contract plans, Other major carriers have been quick to respond to, or even match those offers. However, the survey shows that more T-Mobile's feature phone customers, 21%, are planning to change carriers when buying their first smartphone than Verizon customers, 19%.

Sprint had the most feature-phone customers seeking to change carriers to get their first smartphone, with 36%, while AT&T was second, with 29%.

Verizon also had the highest number of feature phone owners switching to a first smartphone who said they would not switch carriers, with 39%. AT&T ranked second with 30% on that measure, followed by T-Mobile, 29%, and Sprint, 21%.

Current smartphone owners are less willing to change carriers than future smartphone buyers, according to Kantar's data, and in fact have grown more loyal to all the carriers except for Sprint when compared to the first quarter of 2013. Verizon topped out with the most loyal smartphone customers at 91%, followed by T-Mobile, 89%, AT&T, 83%, and Sprint, 74%.

T-Mobile's smartphone-owner loyalty rating jumped from 71% in the first quarter of 2013 to 89% in the first quarter of 2014.

Kantar said that feature phone owners are less likely to remain loyal partly because many are on pre-pay plans that allow them to change carriers without penalities.

Looking at current smartphone owners who switched carriers in the first quarter, Kantar analyst Carolina Milanesi said those at Sprint and T-Mobile switched primarily to get better network coverage, while those at Verizon and AT&T switched for lower costs.

Milanesi said that of the AT&T smartphone owners looking to change carriers, 65% are considering Verizon, while 56% of Verizon smartphone owners are considering T-Mobile. Of those 56%, nearly two-thirds (64%) said they are considering buying an iPhone.

"The real battleground in carriers' acquisition and retention [of customers] is quality of service and competitive pricing," Milanesi said. Quality of service includes national coverage, speed, reliability and call quality.

But she also said that it's difficult to conclude how much of an impact T-Mobile's pricing changes have had. Of the Verizon feature phone users wanting to leave for another company, only 31% are considering T-Mobile, she noted. "This to me shows that although the new [prices] are interesting, they are still difficult to understand for your average consumer," she said.

This article, One-fourth of first time smartphone buyers are looking to change carriers, was originally published at Computerworld.com.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His email address is mhamblen@computerworld.com.

See more by Matt Hamblen on Computerworld.com.

Read more about wireless carriers in Computerworld's Wireless Carriers Topic Center.

This story, "One-Fourth of First-Time Smartphone Buyers Want to Change Carriers" was originally published by Computerworld.

Insider Resume Makeover: How (and When) to Break the Rules
Join the discussion
Be the first to comment on this article. Our Commenting Policies