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Cellular forums Home > Archive > Cingular cell phone service > February 2007 > Cingular vs. Verizon Wireless: Battle of the Titans
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Cingular vs. Verizon Wireless: Battle of the Titans
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|
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| "http://wireless.seekingalpha.com/article/25671"
| |
| Todd Allcock 2007-02-03, 3:33 pm |
| At 03 Feb 2007 10:41:56 -0800 SMS wrote:
> "http://wireless.seekingalpha.com/article/25671"
>
I've been wondering what the March TDMA (account) shutoff will do for 1Q
churn. There's got to be several hundred thousand or so customers still
on TDMA between AT&T Free2Go and the resellers that don't intend to switch.
(Heck, I've still got a half-dozen fully active TDMA prepaids on
Beyond Wireless sitting around between the house and cars!)
I guess there's a PagePlus phone or two in my future!
| |
|
| Todd Allcock wrote:
> At 03 Feb 2007 10:41:56 -0800 SMS wrote:
>
> I've been wondering what the March TDMA (account) shutoff will do for 1Q
> churn.
Probably a small upturn, but Cingular's been very successful at getting
people off of TDMA/AMPS with their worsening of the network, and their
penalty for continuing on the old system.
| |
|
| Todd Allcock wrote:
> At 03 Feb 2007 10:41:56 -0800 SMS wrote:
>
> I've been wondering what the March TDMA (account) shutoff will do for 1Q
> churn. There's got to be several hundred thousand or so customers still
> on TDMA between AT&T Free2Go and the resellers that don't intend to switch.
> (Heck, I've still got a half-dozen fully active TDMA prepaids on
> Beyond Wireless sitting around between the house and cars!)
Me too, though I don't use them anymore.
> I guess there's a PagePlus phone or two in my future!
I have two of them now, and they've been fine. Only issue is that my
daughter's friend are constantly borrowing her phone when they don't
have coverage on Sprint, T-Mobile or Cingular, none of which are very
good in the San Francisco Bay Area.
| |
| Todd Allcock 2007-02-04, 4:33 am |
| At 03 Feb 2007 11:50:54 -0800 SMS wrote:
>
> Me too, though I don't use them anymore.
Well then, between the two of us, we'll add about 0.000002% to Cingular's
churn in about 60 days... ;-)
| |
|
| Todd Allcock wrote:
> At 03 Feb 2007 11:50:54 -0800 SMS wrote:
>
>
> Well then, between the two of us, we'll add about 0.000002% to Cingular's
> churn in about 60 days... ;-)
LOL, I wonder if they exclude the loss of MVNO prepaid from their churn.
The include all of it in their new customer acquisitions, so logically
they should include it in the churn, but I doubt if they do.
I wonder if the reason that Verizon isn't really into prepaid very much
is that they understand that good prepaid has a negative effect on
postpaid. The analysts were saying that they really look at postpaid net
additions, postpaid churn, and ARPU to evaluate a carrier's strength.
Verizon now has the most retail customers of any network, and may pass
Cingular in total customers later this year, depending on how successful
the iPhone is for Cingular.
| |
| John Navas 2007-02-05, 4:33 am |
| On Sun, 04 Feb 2007 08:40:05 -0800, SMS <scharf.steven@geemail.com>
wrote in < 45c60c66$0$69032$742
ec2ed@news.sonic.net>:
>I wonder if the reason that Verizon isn't really into prepaid very much
>is that they understand that good prepaid has a negative effect on
>postpaid. ...
Other way around -- prepaid is a good source of new postpaid customers,
which is why smart carriers are now going after prepaid given the
saturation of the postpaid market.
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
| |
| Todd Allcock 2007-02-05, 4:33 am |
| At 05 Feb 2007 06:20:18 +0000 John Navas wrote:
> Other way around -- prepaid is a good source of new postpaid customers,
> which is why smart carriers are now going after prepaid given the
> saturation of the postpaid market.
Citation?
While I agree that smart carriers are going after prepaid, I don't agree
it's in hopes of converting them- it's more likely a case of having
already picked the proverbial "low-hanging fruit."
Unless the world has changed in the five or six years since I was a
Cingular dealer, prepaid customers mostly fall into three categories;
poor credit (who, ironically, are excellent customers for ARPU),
emergency/light users (lousy ARPU), and transients- those trying out a
service, or needing a line for a limited time, like a temporary
work/living situation.
The first group can't convert to postpaid (at least not without a large
security deposit), the second group doesn't want to, and the third may or
may not depending on their circumstance but not necessarily with the same
carrier they have their prepaid service with. I'm sure a very small
number convert, but a negligible one, I suspect.
| |
| John Navas 2007-02-05, 4:33 am |
| On Mon, 05 Feb 2007 00:01:28 -0700, Todd Allcock
< elecconnec@AmericaOn
Line.com> wrote in <eq6lnm$edg$1@aioe.org>:
>At 05 Feb 2007 06:20:18 +0000 John Navas wrote:
>
>
>Citation?
<http://www.researchandmarkets.com/reports/364762>
<http://www.vonmag.com/issue/2005/se...epaid_voice.asp>
<http://www.dataguardsystems.com/whi...ellular-pos.asp>
<http://findarticles.com/p/articles/..._37/ai_97757990>
<http://www.ericsson.com/technology/... />
harg_A.pdf?
<http://www.convergenceplus.com/ feb...
com%2004a.html>
( You will of course afford me the same courtesy in return -- right? ;)
>While I agree that smart carriers are going after prepaid, I don't agree
>it's in hopes of converting them- it's more likely a case of having
>already picked the proverbial "low-hanging fruit."
I'd say it's both.
>Unless the world has changed in the five or six years since I was a
>Cingular dealer, prepaid customers mostly fall into three categories;
>poor credit (who, ironically, are excellent customers for ARPU),
>emergency/light users (lousy ARPU), and transients- those trying out a
>service, or needing a line for a limited time, like a temporary
>work/living situation.
Citation? ;)
>The first group can't convert to postpaid (at least not without a large
>security deposit), ...
In the short term, but a significant portion may well be able to convert
in the longer term, in part by establishing a long-term relationship
with the carrier.
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
| |
|
| Todd Allcock wrote:
> While I agree that smart carriers are going after prepaid, I don't agree
> it's in hopes of converting them- it's more likely a case of having
> already picked the proverbial "low-hanging fruit."
It's interesting that the different carriers have such different prepaid
versus postpaid portfolios of customers.
Obviously Verizon doesn't feel that postpaid is saturated, they added
2.1 million postpaid customers out of 2.3 million total additions,
though probably most of them came from the much higher churn from the
other three major carriers.
Sprint and Cingular have become very dependent on prepaid and wholesale
MVNO customers to boost their numbers.
Verizon's own prepaid service is a very bad deal, and not many people
know about MVNOs like PagePlus, so it's almost as if Verizon is saying,
"if you want the best network in the U.S., either sign up for a postpaid
plan, or forget it. So the people that want prepaid go somewhere else.
> Unless the world has changed in the five or six years since I was a
> Cingular dealer, prepaid customers mostly fall into three categories;
> poor credit (who, ironically, are excellent customers for ARPU),
> emergency/light users (lousy ARPU), and transients- those trying out a
> service, or needing a line for a limited time, like a temporary
> work/living situation.
There's probably a lot of concern among the carriers that the light
postpaid users will someday realize that prepaid would be a lot cheaper
for them, as is happening in some groups of users, such as seniors. On
the other hand, the younger people that have prepaid will almost
certainly eventually switch to postpaid, though not necessarily on the
same carrier's network. Since they can get a new handset for free when
they go to postpaid, there is really nothing that binds them to their
prepaid network.
| |
| SlobbyDon 2007-02-05, 12:33 pm |
| Todd Allcock wrote:
> At 05 Feb 2007 06:20:18 +0000 John Navas wrote:
>=20
>=20
> Citation?
>=20
>=20
> While I agree that smart carriers are going after prepaid, I don't
> agree it's in hopes of converting them- it's more likely a case of
> having already picked the proverbial "low-hanging fruit."
>=20
>
Verizon doesn't make it easy to convert from prepaid to contract. Try =
porting your prepaid number.
--=20
SlobbyDon
| |
| Todd Allcock 2007-02-05, 12:33 pm |
| At 05 Feb 2007 07:32:44 +0000 John Navas wrote:
customers...
[color=darkred]
>
> <http://www.researchandmarkets.com/reports/364762>
That one actually backs what I said- prepaid customers are desirable
because all the postpaid customers are already taken. It doesn't mention
_anything_ about converting prepaid customers to postpaid.
> <http://www.vonmag.com/issue/2005/se...epaid_voice.asp>
Do you even read the articles you google?
That said less about cellular prepaid than it did prepaid VoIP and
landline, and didn't say a word about converting.
> <http://www.dataguardsystems.com/whi...ndemand-online-
cellular-pos.asp>
Again, says postpaid market is growth-limited, but prepaid market is
still fairly untapped. Says nothing about conversion to post-paid.
> <http://findarticles.com/p/articles/..._37/ai_97757990>
This one is about converging prepaid and postpaid backend billing
systems. Not even close to being on topic. Obviously you didn't even
glance at this one.
>
<http://www.ericsson.com/technology/..._c
harg_A
..pdf?
> <http://www.convergenceplus.com/ feb...
com%2004a.html>
Both of those, like the one above are about integrating the carrier's pre-
and postpaid billing systems- nothing about customers converting from
one to the other.
> ( You will of course afford me the same courtesy in return -- right? ;)
Sure- I can easily post links to a half-dozen articles unrelated to the
subject. Got any topic prefereces? ;-)
>
agree[color=darkred]
>
> I'd say it's both.
You've provided plenty of evidence to support the low-hanging fruit theory,
but none for conversion.
>
>
> Citation? ;)
Well, since I was reporting a personal first-hand experience from five
years as an independent (but exclusive) Cingular dealer I believe my post
IS the citation, but you could click on the first link you offered me
above- it describes the type of prepaid customer, (but, again, says
nothing about converting them to postpaid.)
>
> In the short term, but a significant portion may well be able to convert
> in the longer term, in part by establishing a long-term relationship
> with the carrier.
Doubtful, IMHO, at least "by relationship." Only by repairing their
credit would they qualify. At least in the circa-1997-2002 Cingular
days, when I was a Cingular dealer, the postpaid group used 3rd-party
credit scoring from companies like Experian and Equifax for credit
determination, and any prepaid account was definitely not considered,
since it wasn't reported to credit bureaus as no credit was extended in
the process.
Perhaps GoPhone has changed things, but technically it's not an extension
of credt either, so I doubt it. More helpful would be the "controlled
spending" postpaid programs (Cingular used to offer one called "Balance
Checker," I don't know if they still do, but I believe Sprint and T-Mo
do.)
On a "balance checker" type plan, in return for a lower deposit (i.e.
$200 instead of the $500 or more they might have paid) the customer gets
a regular post-paid rate plan but pays a monthly administration fee
(Cingular's was $10) and their account gets suspended the minute it goes
over a certain balance (Cingular's was $85) until a payment was received
to get it below $85 again. So as long as you paid your bills on time or
go too far over your alloted minutes you had service. Certain extras
were disallowed (international calling, roaming and data, for example,)
because of the potential for abuse, or delayed reporting (i.e. you could
run up $100s in roaming before the roaming carrier reported it in those
days.)
However, since those were still postpaid plans, they did build credit,
and Cingular offered to convert them to regular accounts in 12-months if
the customer made all monthly payments on time.etwork I suspect with
GoPhone's monthly option offering a similar priced service with less risk
to Cingular, "Balance Checker" is an anachronism, but it was an early
attempt to provide postpaid service to less creditworthy customers.
| |
| John Navas 2007-02-05, 3:33 pm |
| On Mon, 05 Feb 2007 10:16:59 -0700, Todd Allcock
< elecconnec@AmericaOn
Line.com> wrote in <eq7sf2$a2q$1@aioe.org>:
>At 05 Feb 2007 07:32:44 +0000 John Navas wrote:
[SNIP misrepresentations of both my argument and my citations]
>
>Doubtful, IMHO, at least "by relationship." Only by repairing their
>credit would they qualify. At least in the circa-1997-2002 Cingular
>days, when I was a Cingular dealer, the postpaid group used 3rd-party
>credit scoring from companies like Experian and Equifax for credit
>determination, and any prepaid account was definitely not considered,
>since it wasn't reported to credit bureaus as no credit was extended in
>the process.
What Cingular may have done in the past is irrelevant -- it could easily
decide to extend some form of postpaid (perhaps with a credit limit) to
those with a given prepaid record -- it's a moderate non-cash business
risk that can easily be managed with the appropriate backend systems
(the point of some of my citations, as you might have noticed had you
not been so determined to find fault with them). In addition, many of
those not qualifying for prepaid are simply those too young to have a
credit history, who can establish such bona fides over time.
>Perhaps GoPhone has changed things, but technically it's not an extension
>of credt either, so I doubt it. More helpful would be the "controlled
>spending" postpaid programs (Cingular used to offer one called "Balance
>Checker," I don't know if they still do, but I believe Sprint and T-Mo
>do.)
Such plans, which can be constructed from a wide range of options, fall
into so-called "hybrid" backend systems.
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
| |
| Scott 2007-02-05, 10:33 pm |
| John Navas < spamfilter1@navasgro
up.com> wrote in
news:9otes2l1e989mjd
0kr03d1jp65raeei337@
4ax.com:
> On Mon, 05 Feb 2007 10:16:59 -0700, Todd Allcock
> < elecconnec@AmericaOn
Line.com> wrote in <eq7sf2$a2q$1@aioe.org>:
>
>
> [SNIP misrepresentations of both my argument and my citations]
>
Whoa, Zippy- Todd was right. None of what you posted supported your
argument and in many instances supported his personal experience) Quit
being such a clueless moron and try reading what you are finding through
Google before you post links.
You know nothing about cellular and your fifteen minutes of fame was up
long ago.
| |
|
| Todd Allcock wrote:
> Again, says postpaid market is growth-limited, but prepaid market is
> still fairly untapped. Says nothing about conversion to post-paid.
It may be limited, but it certainly isn't at saturation.
For Q4 2006:
Cingular added 0.746 million new postpaid customers
Sprint lost 0.3 million postpaid customers
T-Mobile added 0.783 million postpaid customers.
Verizon added 2.1 million new postpaid customers
So in one quarter, 3.3 million new postpaid customers were added to a
total base of about 175 million postpaid lines. It's about 2% for the
quarter, so if each quarter was about the same, it'd be about 8% per
year. Not a huge growth rate, but still not at saturation.
| |
| John Navas 2007-02-06, 10:33 am |
| On Mon, 05 Feb 2007 19:47:21 -0800, SMS <scharf.steven@geemail.com>
wrote in < 45c7fa51$0$68970$742
ec2ed@news.sonic.net>:
>Todd Allcock wrote:
>
>
>It may be limited, but it certainly isn't at saturation.
>
>For Q4 2006:
>
>Cingular added 0.746 million new postpaid customers
>Sprint lost 0.3 million postpaid customers
>T-Mobile added 0.783 million postpaid customers.
>Verizon added 2.1 million new postpaid customers
>
>So in one quarter, 3.3 million new postpaid customers were added to a
>total base of about 175 million postpaid lines. It's about 2% for the
>quarter, so if each quarter was about the same, it'd be about 8% per
>year. Not a huge growth rate, but still not at saturation.
That's a very slow growth rate, which means that it's near saturation.
See links in my earlier post in this thread.
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
| |
| Don Udel \(ETC\) 2007-02-06, 12:33 pm |
|
"John Navas" < spamfilter1@navasgro
up.com> wrote in message
news:ph7hs2h5r8scqhi
728hton1fbdvsqdd9tc@
4ax.com...
> That's a very slow growth rate, which means that it's near saturation.
Why so? Saturation is only one (of many) reason for slow growth rate. At
the inception of cellular service, the growth rate was very slow (due to the
high cost of service, limited coverage and handset costs). Would you have
claimed the cellular market was saturated then?
Don
| |
| John Navas 2007-02-06, 12:33 pm |
| On Tue, 6 Feb 2007 12:34:08 -0500, "Don Udel \(ETC\)"
<donudel@ellijay.com> wrote in <eqae6i05vc@enews5.newsguy.com>:
>"John Navas" < spamfilter1@navasgro
up.com> wrote in message
> news:ph7hs2h5r8scqhi
728hton1fbdvsqdd9tc@
4ax.com...
>
>Why so? Saturation is only one (of many) reason for slow growth rate. At
>the inception of cellular service, the growth rate was very slow (due to the
>high cost of service, limited coverage and handset costs). Would you have
>claimed the cellular market was saturated then?
See the part of my post that you snipped. ;)
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
| |
| Todd Allcock 2007-02-07, 4:33 am |
| At 06 Feb 2007 12:34:08 -0500 Don Udel (ETC) wrote:
> Why so? Saturation is only one (of many) reason for slow growth rate.
> At
> the inception of cellular service, the growth rate was very slow (due
> to the
> high cost of service, limited coverage and handset costs). Would you
> have
> claimed the cellular market was saturated then?
Actually the growth rate was high Back then because the customer base was
tiny- i.e. going from 10 customers to 100 is a 1000% increase!
But as to saturation, how about some quickie math: as of the 2000 census
there were about 240,000,000 Americans aged 10 and up, and there are
about 200,000,000 wireless phone customers in the US. I'd call that a
pretty saturated market unless Fisher-Price and Hasbro start building
cellphones! ;-)
| |
| 3Gfreak 2007-02-08, 10:33 pm |
| On Feb 3, 10:04 pm, Todd Allcock <eleccon...@AmericaOnLine.com> wrote:
> At 03 Feb 2007 11:50:54 -0800 SMS wrote:
>
>
>
> Well then, between the two of us, we'll add about 0.000002% to Cingular's
> churn in about 60 days... ;-)
You are about right on the money. In fact most will either migrate to
GOPhone or to a Post Paid account.
3GFreak
www.mobilevertigo.com
| |
|
| 3Gfreak wrote:
> On Feb 3, 10:04 pm, Todd Allcock <eleccon...@AmericaOnLine.com> wrote:
>
> You are about right on the money. In fact most will either migrate to
> GOPhone or to a Post Paid account.
Unlikely. I know many people that when AT&T wireless was acquired by
Cingular, and began shutting down their TDMA network, went first from
postpaid AT&T TDMA to postpaid Cingular GSM, and then when they didn't
like the higher rates, went from from postpaid Cingular GSM to prepaid
T-Mobile. I helped start the trend among the senior citizens where my
mother and stepfather live!
There is no loyalty that makes it more likely that a prepaid user
switching to postpaid will stick with the same carrier, and vice-versa.
Since the phone is basically free when you sign up for postpaid, there
is even less loyalty in that direction.
Amusingly, the main concern of some of the people moving from one
carrier to another is that they don't want to re-enter their contact
data. I had to unlock my mom's Cingular Nokia GSM phone so she could use
it on T-Mobile prepaid, even though they wouldn't have charged her any
more for a phone plus SIM, than just the SIM.
| |
| Todd Allcock 2007-02-09, 4:33 am |
| At 08 Feb 2007 16:04:48 -0800 3Gfreak wrote:
Cingular's[color=dar
kred]
>
> You are about right on the money. In fact most will either migrate to
> GOPhone or to a Post Paid account.
Most of the "real" Free2Go'ers probably will, because Cingular will let
them transfer their remainng balance to a GSM option. Particularly those
who bought AT&T airtime at firesale prices (AT&T refills were seling on
eBay for 20-cents on the dollar eventually- some folks loaded up several
hundred dollars of airtime. Some have converted those high balances into
free post-paid service for nearly their entire contract!)
Yet I expect the majority of those willing or intending to convert to
Cingular GSM already have. There are still probably a few hundred
thousand accounts left, many with the TDMA resellers, like Locus, Beyond,
Consumer Cellular, etc. Not all of the resellers have been as generous
with conversion options, and some, like Locus and Consumer, also operate
CDMA MVNOs, so many of their TDMA customers might move to CDMA for the
same approximate coverage TDMA afforded them.
In my case, my Beyond accounts were primarily to provide analog and
roaming backup to my T-Mobile GSM phones. Some of the areas I travel to
infrequently aren't covered by Cingular (at least not by Cingular prepaid)
so Cingular GSM prepaid (or a Cingular MVNO) isn't a backup option, but
Beyond TDMA let me roam on Verizon analog in those areas for $0.60/minute.
It looks like PagePlus is the only economical realistic backup option for
me now.
| |
| John Navas 2007-02-09, 10:33 am |
| On Thu, 08 Feb 2007 16:44:00 -0800, SMS <scharf.steven@geemail.com>
wrote in < 45cbc3d6$0$69010$742
ec2ed@news.sonic.net>:
>3Gfreak wrote:
>
>Unlikely. I know many people that when AT&T wireless was acquired by
>Cingular, and began shutting down their TDMA network, went first from
>postpaid AT&T TDMA to postpaid Cingular GSM, and then when they didn't
>like the higher rates, went from from postpaid Cingular GSM to prepaid
>T-Mobile. I helped start the trend among the senior citizens where my
>mother and stepfather live!
Trend? Many? How many actually? 10? Out of millions. ;)
>There is no loyalty that makes it more likely that a prepaid user
>switching to postpaid will stick with the same carrier, and vice-versa.
Market data makes it pretty clear that there is considerably brand
loyalty, just as there is in other consumer markets.
>Since the phone is basically free when you sign up for postpaid, there
>is even less loyalty in that direction.
Most prepaid phones aren't free.
--
Best regards, FAQ FOR CINGULAR WIRELESS:
John Navas <http://en.wikibooks.org/wiki/ Cingu...less_FA
Q>
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