What? AT&T got a No. 1 rating?

The mobile provider drives customers crazy with its poor voice, data and text quality. But it can claim victory in 1 area: 4G service.

By Jason Notte Nov 29, 2012 2:54PM

Businessman using smartphone - Image Source, Image Source, Getty ImagesWell, AT&T (T) wireless customers, at least your carrier is good at something.


Consumer Reports published its rankings of the major mobile carriers Thursday and placed AT&T dead last in overall quality, dragged down by its particularly hideous voice, data, text and value scores. Verizon (VZ), meanwhile, took first place yet again and widened its lead over second-place Sprint (S) from just a point last year to six points this year.


So what's the silver lining to 63,000 surveyed customers ranking AT&T lower than T-Mobile in customer satisfaction? Its 4G LTE network was considered the best of any carrier and its higher-speed service received the fewest complaints.


That seems small consolation, but it's a big step considering Apple (AAPL) just released the iPhone 5 as its first 4G smartphone in September. The millions of those devices that immediately flooded the market -- and millions more stuck in the pipeline thanks to supply constraints -- make speed a valued asset. PCWorld clocked AT&T's 4G LTE network at 9.12 megabits per second, the fastest of any carrier.


With Verizon getting a head start by launching its now-widespread 4G LTE network at the end of 2010, Sprint's 4G LTE network finding its footing and T-Mobile planning to launch its own 4G LTE network next year, AT&T could use just about any edge it can get. As it is, the iPhone 5 isn't doing AT&T that many favors. Even with the new device in its arsenal, AT&T netted 151,000 new customers under contract last quarter. Verizon multiplied that by nearly 10, adding 1.5 million net contracts to its rolls over the same span.


AT&T notes that those 4G customers tend to spend more, with more than a third of customers enrolled in AT&T's new Mobile Share data plan introduced in July choosing the largest plans of 10 gigabytes or more. However, those 4G devices tend to pound company margins. AT&T's third-quarter wireless profit margin fell to 40.8%, down from 45% in the second quarter and 43.7% a year ago.


That's largely because the 4.7 million total iPhones sold last quarter made up 77% of AT&T's overall smartphone sales. Roughly 1.3 million of those iPhones were iPhone 5 units. Contrast that with Verizon, which had a 50% wireless profit margin last quarter after less than half of its 6.5 million smartphone sales were iPhones and only 651,000 were iPhone 5 units.


If playing in the high end of the mobile market is getting too costly, AT&T should rest soundly knowing it's getting high marks for low-cost phones as well. While low-cost and prepaid carriers like US Cellular, Virgin and TracFone all received accolades for their pricing and service -- even outstripping the major carriers in some cases -- an AT&T partner was a darling of the flip-phone crowd. Consumer Cellular, which uses AT&T's network, was lauded by users in the Consumer Reports survey for offering quality, no-frills voice and text service and taking monthly payments without a contract.


"Some smaller carriers that scored respectably in our ratings and offer low-priced plans, such as Straight Talk and Virgin Mobile, now offer fairly sophisticated smart phones," said Paul Reynolds, electronics editor for Consumer Reports. "And you can even save by switching a phone from a major carrier that's coming off contract to a prepaid plan."


Don't worry, AT&T. Even if you can't hang with the wireless industry's big boys, you still have fans among the mobile market's little guys.


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14Comments
Nov 29, 2012 4:51PM
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AT&T is the worst service by far!  They are a joke, and we will be taking our 5 lines somewhere else as soon as we can. I can't use my phone over 50% of the time!!  That is ridiculous!  I run a business that depends greatly on my cell phone, and it doesn't work but half the time, and most the working 50% is me walking out into my yard and moving constantly to get a signal.  And we can be somewhere with a full 5 bars (means nothing anymore obviously) and the "3G", and cant make a call.  They used to be great, but they suck and I hate AT&T service.  And you  will NEVER get AT&T to take anything off your bill for all the dropped calls or non working service, and 90% of the time with customer service is just wasted time.  Goodbye AT&T!!!!
Nov 29, 2012 10:40PM
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I am a telecommunications technician and I travel around the country installing equipment for all the phone carriers. Your service depends on where you live, where you go, and the phone you use. Verizon provides the best overall service but if you do not do extensive traveling, especially in remote areas then you may get better service with someone else or just as good service with a smaller provider. If I did not need the better service nationwide then I would use someone that is cheaper that is more suited for my use. So, find what is best for you and try to save money in the process.
Nov 29, 2012 5:01PM
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 I have been  loyal AT&T customer for years. I never have had any problems with either service or calls. I don't know what  people are talking about when they complain about cell phone service. My Daughter has Verizon and has awful cell reception. Friends have had their Verizon service go down and I had to make calls for them because I still had a usable cell phone. 
Nov 29, 2012 6:18PM
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Verizon best network, horrible customer service.  Sprint mediocre network, fantastic customer service.  ATT mediocre network, horrible customer service. Haven't use T-Mobile in a long time and don't know anyone using it so can't comment on them.
Nov 30, 2012 8:36AM
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All of these articles are redundant. What's wrong with AT&T? Well, it has a hired-in management team that spends more time compensating itself than building the business. The business itself- isn't one. It was sold to an Israeli firm years ago and consists of older critical people here in America managing an array of outdated processes and programming and a huge India tech component. Like most American businesses, it's just a platform of little value and a lot of smoke and mirror management and Board wrangling. If you own the stock, it will drop like a rock when and as subscribers walk away. There isn't anything else of value holding it up.
Nov 29, 2012 5:10PM
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Listen [people! Before you think AT&T is so wonderful you need to know this!! They hired a potential CEO understudy and decided not to use him! Cost over 13.5 million in golden parachutes for this ___hole!!
Nov 29, 2012 4:13PM
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Didn't I just see an MSN article," AT&T rated the worst cell phone carrier"? I think they have excellent customer service.
Nov 29, 2012 3:50PM
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WANT TO GET DROPPED PHONE CALLS GET THE FREE PHONES IT ALWAYS WORKS OUT THAT WAY.... FREE PHONE GIVES U PLENTY TO WORRY ABOUT
Nov 29, 2012 5:02PM
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AT&T Sucks! Can't begin to tell you how it treated employees who put it where it is!


Nov 29, 2012 5:03PM
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I cringe every time I see their commercial.  They are totally the worst.  Don't care what Consumer Reports says.
Nov 29, 2012 5:20PM
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At&t sucks....   their staff sucks..... their area coverage sucks......only thing good about them? they are not verizon.....
Nov 29, 2012 3:49PM
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Ive worked with Sprint and Nextel and had tmobil service and been a loyal customer of att for 30 years even when i could get a free phone working with other networks i prefered ATT // their customer service never says no and they are not just interested in wham bang thank you mam service pay the penalty and get the hell out like ive noticed other networks to steer their customers.. ATT SERVICE IS THE BEST INSIDE THE US AND OUTSIDE THE USA  TOO... NEVER A DROPPED CALL UNLESS THE OTHER NETWORK  DROPS YOU.. COULD BE A LITTLE EXPENSIVE BUT WORTH EVERYPENNY.. YOU GET FOR WHAT YOU PAY...
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