The FCC released its required annual report on mobile wireless competition, and the report seems to show an industry where the rich are getting richer, which leads many FCC-watchers (including us) to conclude that the FCC will take some steps to at least stem the current consolidation on two providers.
Churn is rising somewhat for most operators; Verizon still has the lowest. The impact of the iPhone seems clear in the report, in that AT&T’s churn declined and Verizon’s grew somewhat. Industry capex rose in absolute dollars, but as a percentage of sales, it’s lower than in the past and more in line with wireline networks.
We think this report will be used by the FCC as a part of its broader net neutrality work, since it suggests that wireline broadband will be much more concentrated and thus presumably less competitive. It’s possible that the commission will try to encourage mobile virtual network operator (MVNO) deals, for example. Perhaps the most compelling comment was that, for the first time, voice usage (call minutes) declined. All of the other metrics of usage (non-voice) increased significantly, which proves that users are substituting SMS and social network use for voice calling.
Keep in mind that much of the data is for 2008 and earlier because of reporting and analytics lag.