Uncommon Wisdom

Apr 22 2010   12:18PM GMT

AT&T earnings: Even the iPhone can’t carry the day

Tom Nolle Tom Nolle Profile: Tom Nolle

AT&T reported earnings 21% lower than a year ago, and the result appears to be linked with the dynamics of its mobile business. While AT&T activated almost a million iPhones going to new customers, it showed only about half that number in net subscriber growth. That means the provider would have lost half-a-million customers had it not been for the iPhone. Nearly 2 million current customers converted to the iPhone, again showing how much AT&T has come to depend on the product.

There has been considerable speculation that AT&T would lose exclusivity for the iPhone, but whether or not it does, the giant mobile carrier appears to be losing the initiative. Being a conduit for consumer electronics is hardly a glamorous mission.

UBS is also reporting that AT&T’s capex plans are somewhat under expectation, which may indicate the company isn’t going to be as aggressive in network modernization under the increasingly constrained financial situation.

The fact that there are rumors Apple is going into the hosting business for over-the-top (OTT) applications associated with the iPhone and iPad (which we think is a given, not a rumor) isn’t going to help AT&T, who may see that cutting off its own service-layer opportunities in monetizing its iPhone success

 Comment on this Post

There was an error processing your information. Please try again later.
Thanks. We'll let you know when a new response is added.
Send me notifications when other members comment.

Forgot Password

No problem! Submit your e-mail address below. We'll send you an e-mail containing your password.

Your password has been sent to:

Share this item with your network: