Consumers Love the iPhone, but Not ATandT, Says Report

The Apple iPhone ranked highest in customer satisfaction in a new CFI Group report, but AT&T received no such love. CFI found that customers who switch carriers for a device are more likely to be unsatisfied with their service, and AT&T customers without iPhones like the carrier more.

Customer satisfaction with smartphones and with the mobile carriers that support them are very separate sentiments, concludes a Sept. 30 study from CFI Group. Nowhere was the discrepancy found to be greater than between the iPhone and its exclusive operator, AT&T.

In ranking customer satisfaction, CFI-like J.D. Power and Associates-found the iPhone to rate higher than any other smartphone. In a survey of more than 1,000 smartphone owners, 92 percent of iPhone users responded that they have their "ideal phone." Further, the iPhone received a satisfaction score of 83 out of 100, while Android-based phones and the Palm Pre ranked at 77, BlackBerry devices scored a 73, and the Palm Treo scored a 70. Windows Mobile and Symbian phones fell into the "other" category, which scored 66.

Among carriers, however, it was T-Mobile and Verizon that came out on top, scoring a 79 for customer satisfaction, while Sprint trailed behind them with a 74. AT&T customers without iPhones gave the carrier a 73, but those with iPhones gave it a 69.

"The iPhone has been a double-edged sword for AT&T: Though it has signed up millions of new customers attracted by the iPhone, many of them may be dragging down AT&T's satisfaction and public reputation," wrote Doug Helmreich, program director with CFI Group, and author of the report with CFI Vice President Phil Doriot.

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CFI additionally found greater dissatisfaction among AT&T customers who switched to the carrier specifically for the iPhone. And while reporting that no smartphone is a bigger burden on its network than the iPhone is to AT&T, the researcher additionally states that "customers who are forced to switch providers are not predisposed to liking the new carrier."

This may seem like good news for Verizon, which 86 percent of smartphones users said was their "ideal provider," but it's not offering the most highly desirable phones. Only 38 percent of Verizon smartphone customers said their current phone is their "ideal phone." However, it's unclear whether Verizon, if put in AT&T's position, would continue to rate as well as it has.

"Consumers clearly want to do more with their smartphones, and if you give it to them they will buy it and use it," said Helmreich in a statement. "The good news is that there's an opportunity to move customers into smartphones. The bad news is that nobody really knows if the networks will be able to handle the stress that will come with data-intensive usage typical of the new wave of smartphone users."

Helmreich continued: "The iPhone has been a cash cow for AT&T, but that cash comes at a cost in terms of overall satisfaction. In effect, switchers can be satisfaction saboteurs if they were not already inclined to choose AT&T. As for Verizon, the scales may tip if customers continue to demand smartphones that the company fails to supply. Then again, will its network hold up if it adds network-heavy smartphones? For now, it's an apples to oranges comparison."

CFI found that users purchased smartphones to, more than anything, browse the Web, send and receive e-mails, and enjoy applications. When devices were ranked according to their "killer features," the iPhone ranked highest for playing audio/video and games, but the Palm Pre ranked highest for checking and sending e-mail, checking voice mail, and surfing the Web. The greatest ease of Bluetooth use went to Android-based phones, which tied the Palm Pre for the top ranking for using maps and directions.

While the iPhone is the satisfaction leader, Helmreich and Doriot write that "the game is not over," as BlackBerry devices narrow the gap and the Pre and Android devices gain ground. "If the iPhone were to lose its application supremacy, that advantage would dwindle even more," the two state in the report, which is available free at the CFI Group Website.