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It’s not just a board game.

In most situations, monopolies aren’t good – the competition of the free market makes for more affordable and better products for the consumer. If you want a case study on how monopolies get lazy and the quality of their product suffers, look no further than the market’s reaction to AT&T’s exclusivity deal with Apple and the iPhone.

AT&T’s network – speaking here from personal experience – is dreadful. Dropped calls are not just common – they’re expected. I can forget making a call from my couch in my own living room (a couch, by the way, my wife sits on and, using her Sprint mobile phone, has very long conversations with her mother and almost everyone else on the planet whilst I try to watch television).

Anyway, back to my central thought here, there are spots on my daily commute along major interstate highways where I know I’m going to drop a call. I’ve joked with customer service representatives, pizza hut order takers and sadly, clients, that I’m on the AT&T network and they can expect me to drop their calls at any moment. They don’t laugh because it’s funny… they laugh because it is true. Everyone knows the AT&T network is… well, AT&T’s network.

Did they grow complacent? Perhaps. The problem for them is, they no longer have exclusive rights to sell the iPhone – their competitor, Verizon, started earlier this year.

Flash forward to earlier this month, Localytics – a mobile analytics firm in Cambridge, Mass. – released findings that show Verizon Wireless powered one in five iPhone 4 devices in the U.S. after just one week of the phones being available on its network. According to the same survey, as of the start of this month, Verizon has 32 percent of the iPhone 4 market. 32 percent!

Now, it should be said that industry experts have not seen the mass exodus from AT&T to Verizon that some expected, but I submit that a significant number of people who want an iPhone go straight to Verizon because they’ve heard about the problems people have with AT&T.

While I can’t prove it, I definitely think AT&T’s monopoly led to their complacency, which compromised quality, which is now costing them customers. The lesson? Maintain high standards of quality and you might not face a similar problem.

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Posted by Matt Wittern on 07/28 at 04:11 PM
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