With a new version of the iPhone in the works, the clock is ticking for AT&T Inc. to get its much-criticized network ready for the looming battle.
The carrier has taken a beating from consumers who have complained about poor coverage in major cities including New York and San Francisco. Now, AT&T is racing to reduce its dropped calls and speed up Web-surfing before Apple Inc. releases a new version of the iPhone that could run on Verizon Wireless's network.
In mid-December, AT&T executives set up a 100-day plan to dramatically improve the company's network in densely-populated cities, according to people familiar with the plan. Since then, AT&T has added new network spectrum to better handle traffic, repositioned antennas to improve reception in office towers and wired more neighborhood cell towers with faster connections.
But even with its recent efforts, the network still has not met customers' quality standards everywhere. While some third-party tests have given AT&T nods for having a faster network, a poll last month by J.D. Power & Associates found AT&T still ranks poorly against Verizon Wireless in call quality.
Some analysts say the scramble to add more capacity might still fall short. "They haven't fixed the network and they're going to see a huge exodus to Verizon" when it gets the iPhone, said Edward Snyder, managing director of Charter Equity Research, a financial research firm that studies the cellular phone industry.
AT&T defended its wireless efforts, and said this year it expects to spend $2 billion more on build-outs for its wireless network and add twice as much capacity as it did in 2009. A spokesman declined to provide details on its spending last year.
It argues that its growing pains with the iPhone position it to provide better service than any rivals picking up the smart phone for the first time.