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iPhone Tug of War: Which Carrier is Best?

It's not quite like the Mac versus PC debate, but close. When the Verizon iPhone debuts on February 10, business owners will have to make an Apple to Apple comparison: should you switch to the new carrier?
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The iPhone has finally broken free from the shackles of AT&T. After more than three years, Apple has signed on with the widely available Verizon network. Let the dancing and partying commence.

Except for this: you might be wondering, once the iPhone is available on Feb. 10, should you make the move? Or, is the iPhone really worth all of the hassle? 

Ron Enderle, principal analyst at the Enderle Group, has a definite opinion on the subject. Shortly after the announcement had people tweeting, texting and talking about the big news, he outlined on his blog the many caveats, subtleties and intricacies that need to be considered before buying an iPhone on the Verizon network right now.

First off, he pointed out that while it's common knowledge Verizon's iPhone will not be able to use its 4G LTE network, AT&T's iPhone isn't technically capable of 4G either, although the carrier claims it is. AT&T's HSPA+ network is a voice network retrofitted to handle data and more of an enhanced 3G network rather than fully 4G. 

IDC analyst William Stofega says AT&T's reputation has been bruised by its inability to deal with the load put on its network by millions of iPhone users. 

He says it's not all the carrier's fault, though.

"Everyone wants to point the finger at AT&T but the devices themselves and their use of network resources [has] not been stellar," he said, adding that Nokia and the Blackberry maker RIM are better at helping phone users make best use of their network assets.

Could Verizon have a similar load problem if a deluge of people buy iPhones for its network?  

"Eventually they could, but Verizon's network appears to have much more headroom," says Enderle. "We likely won't know for a few months yet. AT&T has historically oversold their network even back to the time they were Cingular." 

Stofega thinks the Verizon network can handle increased iPhone traffic because any movement over to Verizon from AT&T will be gradual because the penalty for breaking an AT&T contract is expensive. To check how much it will cost to break an AT&T contract, use this nifty calculator from Wolfram Alpha.

Small biz weighs in
Expert advice aside, plenty of people are lining up to get the iPhone through Verizon.

Long-time Verizon customer Tom Hoebbel from Ithaca, New York, who runs Thomas Hoebbel Photo-Video, says he has a new phone upgrade option but is saving it for when the iPhone is available.

"As a photographer, I often have images and video on my Web site that I want to share with clients or prospective clients. The iPhone will make that easier," he said, adding that he hasn't considered going with an Android-based smartphone because he uses a Mac for his business and thoroughly trusts the Apple brand.

Also contemplating ditching AT&T, Zoe Gayle Villaroman operates a public relations and marketing consulting business out of her San Diego home office, which ironically is the one spot where she gets the worst service.

"AT&T has recently introduced the 3G MicroCell to help boost their pitiful coverage. When I asked AT&T to provide me this product for free to resolve my long-term substandard coverage issues, they said that I must purchase it. Essentially, I pay for a service which I cannot use and, in order to use the service for which I already pay, I must now pay more," she complains.

To be fair, though, when we queried small business owners about their plans regarding the iPhone, many are happily using their iPhones with AT&T and aren't going anywhere.

Los Angeles-based Sayeh Pezeshki runs the online office supply store SortingwithStyle.com and has no intention of switching to Verizon.

"One of the main reasons is because on the Verizon iPhone you will not be able to send an email or do anything else as long as you are in a call. When I have vendors or designers on the phone I am checking into files I keep on my iPhone as well as emailing them and myself reminders as we are on the call," she says.

IDC's Stofega says it's true -- there will be no multitasking during a call on Verizon's iPhone, at least at first. Verizon confirmed that you will not be able to send or receive e-mail on the Verizon iPhone while on a call but can text and perform other tasks, including reviewing previously downloaded e-mail.

"It is related to Verizon's use of CDMA technology versus AT&T's UMTS. We have heard that fix for this problem [is coming] later this year," he said.

Plan pricing between the two carriers is similar. The cheapest voice plan for each buys you 450 minutes for about $40, or $60 for 450 minutes and unlimited texting. For $10 you'll get 500 text messages out of Verizon and 1,000 from AT&T. 

As for data, that's where things have gotten all mixed up. AT&T -- which formerly offered those network-hogging unlimited plans -- switched last year to tiered pricing: $25 for 2GB or $15 for 200MB (and you'll pay more for going over either). They're letting people who previously had unlimited plans keep them.

Verizon, for its part in the craziness, is opening its iPhone floodgate by offering unlimited data for $30 a month but will be announcing tiered plans later, so don't get too jazzed about its all-you-can-eat offering. It may be go away soon after launch. Verizon says if you buy an iPhone on contract. your unlimited data plan will last during the contract even if Verizon moves to tiered usage plans.

To further complicate things, some people like the idea of using Verizon's iPhone as a hotspot for other devices. That's an extra $20 a month for 2GB. While you can't hotspot with AT&T's iPhone, you can pay $20 to tether it to one device and share an internet connection with, say, your laptop. Be careful with that, though. AT&T won't give you any additional data for that hook-up, so any data you use while tethered comes out of your regular data plan.

Still not sure which carrier to stick with or which to dump? When in doubt, listen to the experts: Stofega says don't buy an iPhone at all and that Blackberry is the best bet for business. Enderle says if you must have an iPhone, wait for the iPhone 5 to show up at Verizon sometime in 2011.

Last updated: Feb 10, 2011

CHRISTINA DESMARAIS

Christina DesMarais is an Inc.com contributor who writes about the tech start-up community, covering innovative ideas, news, and trends. On Google+, add her to one of your circles. Have a tip? Email her at christinadesmarais (at) live (dot) com.




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