Alltel, T-Mobile, Palm Lose Most from iPhone

Analysis from NPD indicates that the iPhone has had the biggest negative effect to carriers T-Mobile and Alltel, and to phone manufacturer Palm.

The survey was taken by a sample of 13,000 consumers who had purchased a phone over a 30-day period. 200 of these purchased an iPhone.

It found that an iPhone purchaser was ten times more likely than other new phone buyers to have owned a Palm Treo, and three times more likely to own a T-Mobile branded phone, such as a Sidekick, MDA, or Dash.

However, in a sign that the iPhone is having some difficulty in penetrating the business market, consumers were no more likely than an average phone buyer to have purchased a BlackBerry prior to the iPhone.

The lack of business-centric functionality within the device has been pointed out by some analysts as an item that Apple should focus on in future iterations. While the Internet and media capabilities attract the typical consumer, its lack of corporate e-mail support keeps enterprise users at bay, NPD industry analysis director Ross Rubin said.

Rubin said that the iPhone tries to compete with two cellular phone segments at the same time, while not completely fitting into either one. "Its advanced operating system makes it competitive with smartphones for many tasks, while its sleek design and lack of expandability is reminiscent of fashion phones," he added.

Among those carriers hurt most by the introduction of the device were Alltel and T-Mobile. NPD found that iPhone consumers were three times as likely to have switched from either carrier than the typical phone consumer.

While switchers also came from Verizon and Sprint, it was at a rate no higher than the average. NPD argued that both companies already had robust 3G and multimedia offerings in place prior to the launch of the device, limiting their losses.

T-Mobile's loss of customers could easily be explained by the fact that it is the only other major GSM provider in the US, and generally GSM customers generally stay technology-loyal.

Alltel's higher rate loss is somewhat harder to explain, although the company serves a lot of rural communities, where AT&T is said to have equal, if not better coverage.