AT&T has had a jolly three months, banking $3.8bn in profits and adding 363,000 new contracts. But it remains unclear from whence those new customers have arrived. Not only is the US's second-biggest network* growing, it's actually growing faster than it used to. AT&T's profit for the same quarter last year was a healthy $3.6bn …
Could it be 3G/4G tablet buyers taking £10/mo data contracts? (Hah, as if it would be that cheap in the USA. )
New Contract =/= New Customer
even if New Customer --> New Contract.
Especially with wireless charges typically split from your broadband bill in the US, new connected devices like phones and tablets means a new contract.
Also there might be more companies signing up second vendors for site location fail-over plans. I know there was a big push for it 10-12 years back but a lot of companies didn't have the money at the time so they accepted the risk instead.
Re: New Contract =/= New Customer
I'd be interested to see if shared or "family" plans are counted by the phone or by the contract (two phones, one contract servicing both of them). If it's the latter, then new devices probably wouldn't account for it since many people would roll their new devices into their existing contracts where they offer lower rates for extra devices vs. an independent plan.
T-mobile just announced their new $50/mo will allow you to uses your phone abroad for no extra charge - definitely data, and lower for voice.. AT&T would rinse you to do that...
Thing is , at this meeting , a whole load of the europeans are using T-mobile sims, because they are sim-free friendly (which in the US is not common).
So it would be interesting to know if this is a tablet signup thing (all tablets which have 3G modems), or is it something else?
Sounds a lot like "creative accounting", shoving profits from future or past quarters into the most recent one, to make it look good for Wall Street. I'll believe it if there's no "correction" for a year. The accountants can even manipulate years to "smooth out" fluctuations due to recessions and expansions....but it gets really hard to "manipulate profits" over a 5 year period....unless you're Bernie Madoff.....
I guarantee you that the vast majority of customers came from Sprint. I can't see how anyone can stay with Sprint (outside the markets in which sprint provides frivolous LTE). Both T-mobile and AT&T offer better networks at lower prices.
I'm all ears
"But AT&T has also got its wireless ARPU (Average Revenue Per User) up to $66.20, which is decent by American standards - about twice what we pay in the UK, as American's pay market rates for mobile data rather than having them subsidised by unsustainable voice revenue as we do."
But if the UK market has a cross subsidy from voice to data, how does that affect the ARPU? The ARPU is essentially whatever the network operator finds their market will accept without undue customer losses.
If this argument were true, then either US MNO's have much higher costs or profits, or UK MNO's have much lower costs, or reduced profits. A comparison of the corporate results should give the answers, but I don't have time to do that today. Any other commentards got an hour on their hands to do this?
I'd be more inclined to believe that US mobile regulation is even worse, and its mobile market less competitive than our own. Given how ineffectual OFCOM is that's a frightening thought for US customers.
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