AT&T activates record 3.2m iPhones in summer
updated 08:40 am EDT, Thu October 22, 2009
AT&T adds a high 2m total customers
AT&T today provided results for what it says is one of the best summer quarters in its history. The company says it activated 3.2 million iPhones, the most ever in its history and a steep jump from 2.4 million in the spring. It comes despite the iPhone 3GS having launched the previous quarter and points to increasing demand for the phone between July and September.
About 40 percent of those customers were new to AT&T, the carrier says, indicating a sharp increase from 33 percent in the spring.
The iPhone is also now believed to have had less of a harmful effect on AT&T's expenses, which in the past have often been high as it has had to subsidize Apple's hardware. AT&T's average revenue per person has grown 3.8 percent year-to-year and its data revenue has surged 33.6 percent in the same period, with wireless revenue climbing 10 percent to $12.4 billion and its profit margins increasing from 33.5 percent to 38.5 percent. The combined growth has been more than enough to offset iPhone discounts, according to the company.
Apple's devices formed the majority of the 4.3 million "integrated" (3G, QWERTY keyboard) switched on during the period and contributed to a total addition of about two million total subscribers, bringing the carrier to 81.6 million total cellular customers. About 1.4 million of those new additions were postpaid (per-month) customers with the rest prepaid customers. Customer turnover was also at low levels and dropped from 1.69 percent to 1.43 percent, ranging as low as 1.17 percent for postpaid subscribers.
The move may have helped AT&T mitigate losses due to the recession as its earnings per share dropped only one cent from year to year at 54 cents per share.
AT&T's growth puts pressure on market leader Verizon and significantly closes the gap in their customer bases. Despite acquiring Alltel earlier this year, Verizon's lead has narrowed to just 6.1 million more customers ahead of its own quarterly results, which face uncertain prospects without a clear flagship device to bolster its customers.
Fresh-Faced Recruit
Joined: Aug 2009
Good news!
I think Apple and AT&T did the right thing to make their exclusive US agreements. It was a bold move, especially in the beginning, for both companies, and they probably needed each other's commitments in order to get everything working well. Maybe someone will write a book some day about all the gory details each company had to handle.
The continuing success of the iPhone is evidence to me of the genius of Apple's fundamental "digital hub" vision of its hardware and software products integration with other systems.
Though the fabled "desktop publishing" era preceded this "digital hub", that was yet another collaboration between entities, notably Adobe and Apple, each company contributing key technology which worked together to enable various sea changes in the society at large.
Now, perhaps we're on the verge of yet another era of new technology in the form of Apple's rumored tablet. More and more publications are going totally electronic. It makes sense.
With all this electronic media, the various issues with bandwidth and infrastructure will be vital. AT&T is probably in an all-out "sprint" to catch up and keep up with such demands.