I think people will defect from AT&T if they are unhappy with their reception or other service related issues. Verizon is reputed to have the best reception. As far as contracts go, not everyone with a iPhone 4 is on the hook for two years and some people might be willing to eat the ETF if they see any savings from Verizon (doubtful) or they're just plain sick of AT&T. (I was willing to eat an ETF from Time Warner to switch to Fios for the monthly savings and superior technology.)

If AT&T get an iPhone 5 that supports 4G that would be nice in theory depending on how many markets they actually have 4G coverage and whether they charge a monthly premium to get 4G service as Sprint does currently with their Evo 4G. I'm with Sprint and if I want an Evo 4G I have to pay $10 more a month for 4G service that doesn't exist in my area. It's BS but that's how the cellphone business is these days.

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