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Everybody Hates You, AT&T

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In a move that shouldn't surprise anyone, a survey of 58,000 Consumer Reports readers finds that AT&T (NYSE: T  ) is the country's worst wireless carrier.

AT&T was always a questionable juggernaut, but connectivity woes for Apple (Nasdaq: AAPL  ) iPhone owners and a relentless wave of Verizon Wireless attack ads have clearly dinged Ma Bell's already iffy reputation.

However, it's not as if Verizon Wireless -- a partnership between Verizon (NYSE: VZ  ) and Vodafone (NYSE: VOD  ) -- can proclaim victory. It was actually bumped from the top of the survey this year by smallish U.S. Cellular (NYSE: USM  ) .

U.S. Cellular provides coverage in a little more than half of the states, making the regional carrier an unlikely hero. Sprint Nextel (NYSE: S  ) with its early 4G push or Deutsche Telekom's (OTC BB: DTEGY.PK) T-Mobile with its value proposition would seem to be the more logical candidates to take Verizon Wireless down.

You can just picture the high fives as the wheels turn in U.S. Cellular's marketing department.

It will be an entirely different picture at AT&T, which once again will have to defend its name.

One has to wonder if AT&T's smeared plight would have played out any differently had it not been Apple's exclusive iPhone provider. Its network wouldn't have been bogged down by data-slurping smartphone owners. AT&T wouldn't have warranted raspberries after moving away from unlimited data plans. Verizon Wireless also wouldn't have needed to muddy things up with its "there's a map for that" attack ads. Sure, AT&T would have had to forgo the millions of iPhone users on its network, but the major trade-off there is that it would have been more favorably viewed by consumers if it was simply pushing Androids, BlackBerrys, and more traditional handsets.

We can't go back, though. AT&T is where it is, and improving its network with more cellular towers and making the 4G leap may help paint a new coat over its jagged image by the time next year's Consumer Reports survey makes the rounds.

Between now and then, let's see which AT&T competitor becomes the first to launch a new attack campaign based on the survey.

Will 4G be a game changer for wireless carriers? Share your thoughts in the comment box below.

Vodafone Group is a Motley Fool Inside Value pick. Apple is a Motley Fool Stock Advisor recommendation. The Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Longtime Fool contributor Rick Munarriz is sadly not on Verizon or U.S. Cellular. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

Read/Post Comments (11) | Recommend This Article (13)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 07, 2010, at 2:31 PM, DieselBoatMan wrote:

    This is a hoot, but should be no surprise to anyone, especially to AT&T leadership.

    This is the same company that converted the retirement programs of their management people to a "cash balance" account, and proceeded to rip evey last employee off.

    As a former executive of AT&T (20 years). I'd like to see this company finally get it's just deserts.


  • Report this Comment On December 07, 2010, at 2:39 PM, daveefreedom wrote:

    It makes me I'll, since I work for AT&T. I'm not on mobile side, so I don't know how this will play out.

    I know Fools believe Great management is key for great companies. Perhaps management needs to look at themselves in the mirror.

  • Report this Comment On December 07, 2010, at 2:53 PM, HelloOutThere wrote:

    Dumb title. Maybe some in the consumer reports survey (and of course the Author of this one sided article) , but other surveys show different results. See

  • Report this Comment On December 07, 2010, at 4:11 PM, bigdog0319xx wrote:

    Good counter, HellOutThere. You beat me to it. This article is fair in perhaps one respect: the data demand created by the enormous, never-before-seen popularity of the iPhone. This was like 500,000 people running through the front doors of Wal-Mart on Black Friday. AT&T was best equipped to handle the demand; it's scary to think what backlash there'd have been with some other carrier having exclusivity

    "DALLAS--(BUSINESS WIRE)-- Over the past year, AT&T Mobility has recorded the fewest number of Better Business Bureau (BBB) complaints and received the lowest BBB complaint rate among the four largest national wireless carriers, contributing to an average national rating of A+.

    For complaints closed within the last 12 months as of Dec. 3, 2010, AT&T Mobility’s nearest competitor had 32 percent more BBB complaints and its largest competitor had 62 percent more complaints. However, the best way to compare industry peers is by complaint rate, which is calculated by the number of closed complaints per wireless provider subscriber.2 Using this method, AT&T Mobility’s largest competitor had a complaint rate 34 percent higher, and the complaint rate of its two other industry peers were two times and three times more, respectively.

    Wireless customers in the U.S. file more core customer issue complaints related to carrier advertising and marketing, contract-early terminated, service related issues, and billing and rates with the various BBBs each year than they do with any other entity.3

    Earlier this year, AT&T Mobility announced that it was the only company in America to achieve separate ‘A’ ratings and separate accreditations from every BBB in the U.S. on their report cards for ethical business practices and responsiveness to customers concerns. These rankings are based on BBB confidence that the business is operating in an open and trustworthy manner. Each business undergoes an evaluation in 17 categories including BBB accreditation, how well the company has responded to consumer concerns, the company’s complaint history with the BBB, and the truthfulness of its advertising claims. "

  • Report this Comment On December 07, 2010, at 8:39 PM, rett448 wrote:

    I have had ATT for almost 8 years and I still have no complaints.

  • Report this Comment On December 08, 2010, at 7:34 AM, riprod wrote:

    I cannot believe in the stock, when I cannot believe in the product. AT&T is the worst network and my 4 phone iPhone 3G contract was available for an upgrade to the iPhone 4 in June, but I am just not willing to sign another 2 year contract and have been holding off and waiting for Verizon because the network is so bad. I suspect there are a lot of people like me.

    Regarding 4G. Current 4G is a scam. The international standard for 4G is 100Mbps. US carriers seam to have ignored all standards that define the product and only support about 1/10th of that speed. In fact T-Mobile simply rebranded their old 3G service as 4G.

    4G will be a game changer when the first network announces the service to the defined standard, until then it's just a marketing gimmick, that people will wise up to very quickly.

  • Report this Comment On December 08, 2010, at 10:12 AM, XMFHRFool wrote:

    Good article, but I like AT&T best. The few places that I've had connectivity problems (such as my family's extremely small town of Manchester, MI which has NO coverage whatsoever) I don't actually spend that much time in, so the issue has been negligable. I've been a personal customer of theirs - well, Cingular and AT&T, since 1997 and any issues I have had have been met with very competent and helpful customer service people.

    On the other hand, I ran a corporate account with Verizon that was the worst customer service I have ever experienced. I worked to get the entire company switched to AT&T over the course of a year and have personally boycotted them ever since...that was about 6 years ago...they'll never get my business again.

    I do wish that this silly "have to sign for 2 years" and "eligibility" for upgrade stuff would go away. What is that all about anyway? You'd think that they would want to sell you new equipment rather than give you an incentive to have to wait to buy...makes no sense to me.

  • Report this Comment On December 08, 2010, at 10:54 AM, kotaknight wrote:

    It seems as though AT&T has more of a perception problem than a performance problem. I would credit Verizon with a very effective ad campaign. In reality, no one I know who has AT&T as their wireless carrier feels the service is unsatisfactory.

  • Report this Comment On December 08, 2010, at 11:52 AM, CPKB wrote:

    I second rett448's comment: I have had AT&T as my mobile carrier since 2000 and have no complaints.

  • Report this Comment On December 08, 2010, at 12:23 PM, TMFBent wrote:

    I've been on ATT for years, both with heavy data plans and not. In the years before the iPhone, it generally seemed to me that data flowed better. (I was on a 3G smartphone long before steve jobs new how to spell iPhone...) Now that I'm on a smartphone plan again, AT&T's data flow seems a bit slower, possibly due to network demands, but neither I (nor the average Joe responding to a survey) has any reasonable way to quantify that.

    What we do have is endless press articles telling us that ATT sucks and wouldn't it be so great if the iPhone were on X network instead.

    I think this is predominantly a perception problem. Everyone loves to hate their carrier when something goes wrong, and as other articles have shown, much of what has been blamed on ATT is actually problems with poor iPhone performance. But no one wants to believe their Apple product could be anything less than perfect, so they blame the network.

    (And phones do matter. My old Samsung's radio was giving up the ghost, and I could be in a carload of people who all got 4 bars on ATT, and I'd get only one. If I were an iPhone owner, I'd probably have ranted at how lousy the network was. Instead, I just figured my phone was starting to suck.)

    I live in a hole, coveragewise (and topographically) , and bought an ATT microcell to cover the house. Other than that, I have found ATT to offer great coverage stateside -- except for very few boondocks locations where I generally don't want to be on the phone anyway.

    Because the phones are GSM, overseas connectivity is never a worry -- and is reasonably priced.

    ATT's customer service has always been first rate for me, too, with prompt attention to issues and quick resolution.

    But that's OK. The masses have spoken for now. And the crowd is always right, right?

  • Report this Comment On December 08, 2010, at 3:34 PM, BlueJacketFan wrote:

    They only pay Stephson $29,000,000 a year to run T. What kind of results do you you expect?

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