

Verizon iPhone selling mostly to existing iPhone owners?  - ronnier
http://www.marco.org/3408938814

======
zdw
I'm thinking this is it: _the huge amount of more casual Verizon buyers — the
ones whose arrival to the App Store I’ve been eagerly awaiting — are far more
likely to wait for their contracts to expire._

Most of the people I know who are on Verizon and are Mac focused or Tech savvy
have either an iPad or iPod Touch, and already have the apps they want.

Also, Instapaper is pretty darn geeky in the grand scheme of things - It's
somewhere between RSS readers and Dropbox in terms of non-technical user
acceptance.

~~~
jackowayed
Actually, Dropbox seems surprisingly mainstream. I've been surprised by the
number of not-that-technical people I've run into at college that use it.

But I guess there's still a pretty wide gap in tech-savviness between
humanities majors and Baby Boomers ...

~~~
tomjen3
My mum uses it. It's pretty mainstream.

~~~
mambodog
I've got both my parents using it, mainly just as a file sharing service (drag
file into dropbox, get public URL, paste in email). It's easier for them to
understand than a file sharing site like Rapidshare.

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Kylekramer
I think the easier answer is that Verizon iPhones are strong but not earth
shattering. All evidence so far supports that sales are lower than expected
(best indicator: Apple has yet to do their typical "we sold a million in 48
hours" press release that has followed every other major release). It was
important for Apple to get on more carriers and I am sure it will net another
few billion, but my guess is the tech community overestimated how much pented
up demand there was.

~~~
achompas
Yeah, I'm surprised people were so bullish on the VZW iPhone. Consumers have
had 4 years to switch to AT&T and buy an iPhone. Why would the VZW iPhone
change the market equilibrium in the short run?

~~~
thaumaturgy
I have said previously on HN that the Verizon iPhone was too little, too late,
and that last Summer, Verizon's Android offerings became good enough for most
of the consumers that wanted a smart phone on Verizon's network. Those that
wanted an iPhone badly enough had plenty of opportunity to switch to AT&T; the
remaining hold-outs -- those that hated AT&T passionately enough (or were in
areas that it didn't serve) -- gave up waiting last year and found a good
enough Android device.

For what ever little it's worth, it looks like I was right:
<http://www.pcmag.com/article2/0,2817,2380635,00.asp>

I got shouted down here every time I brought this up.

~~~
elithrar
I'd also argue that consumers are savvy enough to predict a new iPhone coming
out later this year — after all, it has been on a yearly cycle since its
launch.

They may be holding out for a new release rather than committing to a
contract/service now.

~~~
MichaelApproved
I fall into both these examples. I had an iPhone and kept waiting around for
either better reception or verizon iPhone. I finally gave up and bought the
droid 2 last aug but it isn't as good as the iPhone. I qualify for another
upgrade this aug which puts it right about the time iphone 5 comes out. I'll
wait for 5 then dump droid and go back to iPhone.

------
HaloZero
I also know that a large number of people are just waiting till iPhone 5 in
the summer to get the phone on verizon.

~~~
Bossman
That's assuming the CDMA and GSM versions come out around the same time.

~~~
strooltz
i don't have the source in front of me at the moment - it was on HN a week or
so back - but there were parts orders in china that indicate apple is planning
to launch a dual band CDMA/GSM version of iPhone 5...

~~~
Bossman
That would be good, but then again - Apple was supposed to launch the White
iPhone 4 a long time ago, too...

------
pedalpete
Isn't a further possibility that the number of total iOS devices activated
(new owner or existing owner changing service provider) has remained flat.

Wouldn't this be the case if a person wanting to buy an iOS device didn't care
about provider? If BestBuy is the only retailer distributing product X, and
then after a few years, Radio Shack begins stocking the same product, would
you automatically expect product X to have 2x sales? If so, distribution would
be the only thing that mattered in gaining market share.

Am I missing something?

~~~
r00fus
Yes, supposedly AT&T really sucks. It's been the running joke for years that
the iPhone (aka jesus phone) does everything except make calls. Example:
[http://www.thedailyshow.com/watch/tue-
january-11-2011/verizo...](http://www.thedailyshow.com/watch/tue-
january-11-2011/verizon-iphone-announcement)

------
brg
_Verizon iPhone owners are buying very few apps relative to other iPhone
owners. This also seems unlikely._

I would like to see more data to address this question. Especially interesting
would be data form anyone delivering a free ios app. Verizon users have been
pushed towards to Android phones for a year now, and that user base is trained
to look for free instead of paid.

------
topherjaynes
I was an existing Verizon customer, and finally convinced (today) the store to
sell me an iPhone at cost. I had a Razor, from 2006, but my 'free upgrade'
went to my brother a few months ago when he lost his, though I still had a
free upgrade from two years ago I didn't use...apparently those don't accrue
every two years.

Anyways, as an existing Verizon customer they made it really hard for me to
get an iPhone--mainly without spending $749.00. I feel that many customers are
in that weird stage where they can't get the iPhone at the 199/299 price and
if they hadn't left Verizon for AT&T they more than likely weren't dying to
have an iPhone for the price of a new iPad.

(sent from my iPhone)

~~~
JshWright
Why would they "accrue"? You get a subsidy because you renew your contract.
Just because you didn't renew your contract two years ago doesn't mean you
could somehow renew your contract "twice" now.

------
nhangen
My sales have also remained very steady, which I was not expecting at all.
Perhaps it will take time for Verizon iPhone owners to get used to buying
apps?

~~~
mbreese
That was my initial guess... I see two main scenarios for Verizon iPhone
buyers:

1) existing iPhone users switching to Verizon

2) Verizon users that don't have an Android phone buying an iPhone

In the first case, they'd already have the apps they want. In the second, they
may not be used to buying Apps yet. I'd be interested to know what the sales
of something more mainstream would be. I just don't see the buyers of
Instapaper being in category #2.

~~~
angus77
I would assume that new customers with app-less phones would be the most eager
to start filling up their phones with apps---isn't that the point of buying a
smartphone?

~~~
nhangen
When I bought my phone, I swore I wouldn't buy any apps. I don't know why, but
I just thought it was something I had to tell myself. 2 years later,
well...you know how it goes.

------
dpcan
I noticed nearly the exact same thing, but from the Android Market
perspective.

I too have a top 5 app in my category.

I too don't see any change in rank on a day to day basis.

I too have a top 50 paid and free app.

I too have seen no significant change in sales volume since the iPhone launch
on Verizon.

Maybe he's right. Maybe the largest percentage of change has come from iPhone
owners switching networks, but it certainly hasn't affected sales of my apps
in the Android Market which are staying good and strong.

And to be honest, I really thought the Verizon launch of the iPhone was d-day
for Android Market sales. I'm HAPPILY wrong.

------
achompas
_My hypothesis is that most people willing and able to do that for the iPhone
were also willing and able to jump carriers to get an iPhone on AT &T sometime
since its release nearly four years ago._

I said exactly this once the Verizon iPhone rumors started building up a few
months ago.

The cell phone market is a _market_ , like any other. Like any other
(unregulated) market, it has probably been at equilibrium for some time, as
anyone that wanted an iPhone could've switched to AT&T over the last 4 years.
So the strong iPhone demanders are already AT&T subscribers.

Who's left? Casual Verizon iPhone demanders. Let's assume they're not on AT&T
(if they were on AT&T, they'd already own iPhones--trivial case). These people
are casual demanders, so they won't pay $200 to break contract and get
iPhones. They'll wait instead. What happens to them when a Verizon iPhone is
announced? Nothing--they're still locked into their former contracts.

More likely is that Mauro sees a slight trend increase over the next few
months (as these casual iPhone demanders see their contracts end and decide to
buy iPhones).

I'm not shocked that February 10th was not a humongous success. Gruber
predicted something like 1.5-2 million Verizon iPhones sold, but that number
was too high. The iPhone market has had 4 years to settle down.

------
ChuckMcM
His experience correlates with the rate of change in Android/IoS ownership
(aka phone sales/adoption). So basically it would seem that adding Verizon
wasn't a huge boost to the total number of iPhones in folks hands, or that
other signals have swamped that contribution. (The iPad is a good candidate
for such a signal)

------
maguay
I think the biggest reason here might be that most Verizon customers who
wanted to switch to iPhone without switching networks purchased an iPod touch
to get iOS without switching networks. If so, they simply transfered the apps
they'd already purchased to their new iPhone and kept on using them as before.

------
siculars
I'm not so sure. My step father just showed me his brand new verizon iphone he
got the other day. He switched from bberry then tried and returned the
android.

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InclinedPlane
There are circa 75 million iphones in use. AT&T activated about 4 million
phones in q4 2010. The Verizon iPhone has been available for just a little
over 40 days.

If Verizon iphones sold at the same rate as AT&T models (which includes the 3G
and 3GS at much lower prices) we would expect the total installed base to have
increased by... about 2%.

Even if Verizon iphones sold at say 3x the typical rate the resulting 6%
increase in installed base would still fall down into the noise on these
graphs.

In short, this data is not even remotely conclusive.

~~~
kenjackson
It's not the installed base that matters, but rather new users, since they are
presumably the ones who are more likley to buy an existing app. At least
that's my take based on reading Marco's post where there are spike events that
cause sales to go up.

