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Verizon growth, profit slower than AT&T's despite Droid

updated 09:45 am EDT, Thu April 22, 2010

Verizon's Q1 2010 weaker than ATT

Verizon today provided a mild shock to the cellular industry by reporting relatively disappointing results for the early part of 2010. Although still taking advantage of phones like the Motorola Droid, its subscriber growth slowed down to 1.5 million new cellphone users in the winter and was noticeably slower than AT&T's 1.9 million additions over the same timeframe. Its net profit also plunged from $1.6 billion a year ago to $400 million today.

Its total cellphone customer base is now up to 92.8 million.

The company still saw the direct benefit of smartphones as it kept its customer turnover down to a low 1.07 percent and its data revenues up 26.4 percent as more customers had to take on data plans.

Verizon characterized the results as "solid," and some of the profit drop was attributed to taxation of a retirement health care benefit that had previously been deducted. Nonetheless, the results potentially point to AT&T successfully using the iPhone as a way of attracting customers; about a third of iPhone buyers this winter were new to AT&T, and a significant portion of these are likely to have come from Verizon.

The carrier may tighten up competition significantly in the spring as the imminent launch of the HTC Droid Incredible will give it a new Android flagship that, at least temporarily, should out-specify the Apple handset.



By Electronista Staff
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Comments

  1. lkrupp

    Junior Member

    Joined: May 2001

    +3

    No words to describe...

    So the "iPhone killer" isn't helping Verizon all that much? Funny how reality slaps you in the face when you're an iPhone/at&t hater. I'm betting that Verizon's CEO is down on his knees in front of SJ as we speak begging for a CDMA iPhone.

  1. jdonahoe

    Junior Member

    Joined: Jul 2006

    -4

    The iPhone needs to be on Verizon, now!

    As an Apple stockholder, I'm a little worried that this new Droid phone will make potential iPhone buyers from Verizon thinking "I don't need no stinking iPhone". Unfortunately the new Droid has a lot going for it (1Ghz, 800x480, wifi n, and good multi-touch controls) and Verizon may blow off Apple, again.

  1. rampagedeluxe

    Fresh-Faced Recruit

    Joined: Apr 2010

    +3

    Gotta love speculation

    "the results potentially point to AT&T successfully using the iPhone as a way of attracting customers; about a third of iPhone buyers this winter were new to AT&T, and a significant portion of these are likely to have come from Verizon" & "The company still saw the direct benefit of smartphones as it kept its customer turnover down to a low 1.07 percent".

    I love how all the iphone users are going to use this to mean their device is better. The second half of this article is speculation. It has no ties to reality. Iphone has dropped slightly in market share from november to february, while RIM and Android have both gained during that time (android gained significantly). Verizon stated the reasons for the decline, but thats not good enough for the reporter, he would rather make up his own conclusion and lead you to believe that instead of the obvious truth.

  1. Wingsy

    Fresh-Faced Recruit

    Joined: Apr 2005

    0

    One Thing About The Incredible

    One thing users won't get with the Incredible is non-stuttering video. If you want to see for yourself, have a look at the movies shot with it, here:
    http://www.engadget.com/2010/04/19/droid-incredible-review
    I made a similar recording with my 3GS iPhone, panning at the same rate as their sample. Smooth as silk.

  1. davlab

    Fresh-Faced Recruit

    Joined: Jul 2006

    0

    I expected the slowdown in Droid interest

    Like I said in a previous post, Verizon never had a viable competitor to iPhone, until the Droid. Since a lot of Verizon customers refused to switch to AT&T there was a lot of pent up demand for a good smart phone, so when the Droid was available it sold very well for several months. That pent up demand has probably now been met and things are slowing down, whereas iPhone seems to be maintaining a steady rate of sales. Jobs projected 100,000,000 iPhone OS devices would be use this year.

    I think iPhone would do very well on Verizon (even with features missing due to CDMA). The Wall Street Journal had an article speculating on an iPhone coming to Verizon and the comments were very enlightening, considering they were coming from business and non-tech oriented users. You can draw your own conclusions.

    http://online.wsj.com/article/SB10001424052702304370304575152242601774892.html#articleTabs%3Dcomments

    All of these new high-end Android phones are just small variations on the Droid and will probably dilute the brand and confuse people as to which is the better choice. The average phone buyer is just looking for something that has cool features, works well and that they can figure out how to use. All of these Android phones will be like shopping for a PC, you will have innumerable choices with no clear dominant phone in the market and the iPhone will stand out as an easy to use, full featured clear alternative that this time competes on price too.

    Only time will tell how this all plays out.

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