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Dropped iPhone Calls Really Are an AT&T Thing

By Cindy Johnson - Updated Apr 6, 2017 at 10:21PM

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That's good for Apple and Verizon, and bad for AT&T, Motorola, and Google.

When Steve Jobs introduced Apple's (Nasdaq: AAPL) iPad, his confession that its cellular access would be available only through AT&T (NYSE: T) brought audible groans from the audience.

The iPhone was notorious for dropped calls, particularly in the San Francisco Bay Area -- where the iPad launch was held -- and New York City. iPhone owners in those areas are known to have so much trouble with AT&T that they use Skype's iPhone app and a wireless network for iPhone calls. Some of their neighbors compromise with a two-device solution, carrying an iPod Touch and a cell phone from another service provider such as Verizon (NYSE: VZ), Sprint Nextel (NYSE: S), or Deutsche Telekom's T-Mobile.

Whose fault was it? AT&T took most of the heat, but it was never clear that the dropped iPhone calls were not the iPhone's fault. And last year's Antennagate episode with the new iPhone 4 was not exactly an endorsement of Apple's cellular-technology capabilities.

The proof is in the Verizon iPhone
A Verizon version of the iPhone 4 came out in January, to the delight of many an iPhone fan who prizes reliable cellular service. The rollout also allows us to answer that nagging question: Is the iPhone's dropped-call problem AT&T's or Apple's fault?

According to a March study by ChangeWave Research, AT&T is the reason the iPhone drops calls. Users of the Verizon iPhone 4 reported a 1.8% dropped-call rate, the same rate as users of other Verizon phones. Users of the AT&T iPhone 4 reported a 4.8% dropped-call rate, 2.7 times the rate of Verizon iPhone users.

AT&T has been touting network improvements since at least last summer, no doubt over concerns that Verizon would get the iPhone. The ChangeWave survey was last month. Just imagine what AT&T's dropped-call rate was before its network improvements!  

Foolish takeaway
Settling the dropped-call debate is a clear negative for AT&T. And it's a positive for Verizon, although concerns remain that if Verizon signs up too many iPhone users, its network could suffer from overloading and dropped calls, much like AT&T's.

Settling the debate could also boost iPhone sales, a positive for Apple. It could help mitigate some of the pressure from smartphones based on Google's Android, such as Motorola Mobility's (NYSE: MMI) Droid series or HTC's Thunderbolt, which was recently reported to be briskly selling at Verizon stores.

Just don't tell anyone "I told you so."

To stay updated on iPhone news, add Apple or any of the wireless carriers to our new free watchlist service today:

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Apple Inc. Stock Quote
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AT&T Inc. Stock Quote
AT&T Inc.
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