Verizon Campaign Highlights Coverage over Devices

While mobile network operators have aggressively competed for customers by exclusively offering in-demand devices-such as the iPhone on the AT&T network and the Motorola Droid on the Verizon Wireless network-as well as by building catalogs of downloadable applications and offering the newest operating systems, mobile coverage is increasingly becoming a point of competitive leverage.

For example, Verizon has an advertising campaign comparing its 3G coverage areas with AT&T’s, and AT&T has filed suit against Verizon Wireless claiming the coverage maps in the ads are misleading.

Verizon nonetheless released a new ad for the holidays, in which the iPhone is welcomed to the Island of Misfit Toys-known to a certain generation as a potential home for Rudolph the Red-Nosed Reindeer. While the iPhone can download applications and browse the Web, the ad implies that a less-than-satisfactory 3G coverage map makes it a perfect fit for the island.

“Before the iPhone came along and became this iconic device, driving consumers to consider things such as operating systems, network coverage was traditionally the most important thing to consumers, along with price, of course,” Ken Hyers, an analyst with Technology Business Research, told eWEEK.

A recent ADC survey of UK businesses found that 60.8 percent of participants rely on their mobile phones for their jobs, 38.5 percent use their mobile phone as their primary work phone and 27.6 percent reported that their work has suffered due to poor reception.

Howard Wilcox, an analyst with Juniper Research, discussed the survey with ADC, which reported that the majority of mobile use now takes place indoors. Among survey respondents, 22.3 percent said they have coverage problems at their desks, 28.5 percent listed conference rooms as particularly problematic areas and 24.9 percent said basement-level spaces were problematic.

Wilcox wrote in a Juniper blog that poor reception can also be an issue at home, and he pointed out that AT&T’s MicroCell-a femtocell device that acts as a miniature cell tower for a home or small business, boosting signal strength and offering 3G data speeds and unlimited talk time-is designed to improve indoor coverage.

“At Juniper Research we see that the indoor coverage issue is going to be a main driver for femtocells,” Wilcox wrote on the blog.

While some consumers may be focused on devices and operating systems, TBR’s Hyers said one need only listen to the complaints from iPhone users on the AT&T network to know that reception is still very much an issue.

“Call quality has improved to where it’s not a major issue anymore, but call coverage and dropped calls are still important issues for consumers,” Hyers said. “Verizon’s network coverage is certainly the strongest among North American operators, so it makes sense for them to be leading with their greatest strength.”

Hyers added, however, “While Verizon may have an edge in some areas, AT&T (and other operators, too) have better coverage elsewhere. So the current high-profile advertising campaigns between the carriers are about manipulating consumers’ perceptions. I still believe that the best way to choose a cell phone plan that is best for you is to ask your friends and neighbors, who live and work where you do, what they think about their mobile phone service, and find the one that has the best coverage for where you are.”