Verizon Throws Best Customers Under the Bus: Charges Them 3X for iPhone

By most accounts, the arrival of the iPhone to Verizon has been a resounding success.  Record breaking sales, solid reviews, orders going out on schedule, and a general sense of relief that the best smartphone is no longer held hostage by the worst carrier.

But not everybody is thrilled

Meet Lilia Martinez Coburn.

Early adopter.  Entrepreneur.  Former member of the team that brought Verizon VCAST  to market.  Former mobile PM of hi5.   Co-Founder of fast growing startup Townhog.  My wife.  And until recently … more on this in a sec… off the charts Verizon fan girl.

Exactly how much of a fangirl was she?  So much so that she took Verizon’s side in the net neutrality debate, arguing that “carriers have a right to defend their network investment.”  And so much so that three years ago, when I gave her an iPhone for her birthday, she flatly refused it, saying “Verizon’s been good to me, I’m not switching.”

Needless to say, Lilia has been waiting for a Verizon iPhone for a while.  Two nights ago, she eagerly signed into her account at midnight to put in her order.

The first thing she noticed was big, scrawled, red, sloppy font proclaiming “No Discount Available,” and a daunting price point of $650 for the 16GB phone and $750 for the 32GB.

“Seems pricey,” I offered helpfully.  “I thought Verizon was selling them for $200?”

This didn’t calm her down.

So she took to the interwebs.

Twitter:

and Facebook:

The deadly mistake that Lilia seems to have made was shelling out for a new Android phone last year.  By doing so, she apparently lost her ability to upgrade again at a subsidized price.  (EDIT: As pointed out in the comments, this was in her contract.  And it is common behavior for numerous carriers)

So is this a teachable moment?  Sure, let’s take a shot:

– Verizon would rather lose you as a customer than give you the same deal they offer, say, AT&T customers

– Being loyal to carriers is never a good idea – they will sell you down the river at the first opportunity

– Avoid Android like the plague; you never know what doors you are closing for yourself by succumbing to their wiles

This certainly isn’t the first case of a big company valuing customer acquisition over doing right by their existing customers.  And just maybe, Verizon has A/B tested this sort of behavior and concluded that it makes good business sense to shaft their best customers, realizing that most of them will be too lazy to switch carriers over a $500 tax on the new iPhone.

But it feels like bad business.  10 years of carrier loyalty erased for $500.

Lilia, let me be the first to welcome you to AT&T.

Voice is overrated anyway – it’s all about the download speed.