For the second quarter in a row, has met the competitive challenge of the head on, and hasn’t blinked. AT&T’s 3Q08 looks impressive, especially with the 1.7 million net wireless adds, driven by 2.4 million iPhone activations. It’s impressive, until you look at Verizon, who had 1.5 million net adds, without a comparable iPhone effect. From Verizon’s point of view, who needs the iPhone (makes you wonder though – what if Verizon had the iPhone exclusively – can you say smackdown)? All the talk and hype of the iPhone hasn’t phased Verizon – at least not yet.

How has Verizon been able to withstand the challenge? Certainly effective marketing has played a role. Their successful campaign featuring “the network” and that “guy” has contributed to a perception of better quality. There seems to be some substance behind the quality pitch, as evidenced by Verizon’s lower churn rate of 1.33%, which is significantly lower than AT&T’s 1.7%. Maybe quality really does trump style. The next two quarters will be interesting to watch, as later this year, . If it enjoys some decent success, watch out AT&T. You may be hearing “iPhone who,” from smiling Verizon execs.

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