AT&T activates record 3.2M iPhones, says exclusivity could end
AT&T reported its third-quarter results Thursday, recording 3.2 million iPhone activations and adding 4.3 million postpaid 3G devices, but the company's CEO also admitted that the iPhone won't be exclusive forever.
AT&T reported a 2 million increase in total wireless subscribers, which was the highest third-quarter gain in company history. The nation's second-largest wireless carrier now has 81.6 million subscribers.
Of the 3.2 million iPhone activations, nearly 40 percent were customers who were new to AT&T.
The Dallas, Tex., company reported $0.54 diluted earnings per share, down slightly from the $0.55 recorded in the quarter one year prior. Average monthly revenues per subscriber increased 3.8 percent year-over-year, and represented the seventh consecutive quarter with a year-over-year increase in postpaid ARPU.
While the strength of the iPhone helped AT&T beat profit expectations on Wall Street, the company's CEO admitted Thursday that AT&T will not have exclusive access to Apple's handset forever. According to Macworld, Ralph de la Vega said during a question-and-answer session that he believes his company's portfolio will survive after the iPhone moves to other carriers.
"We have a legacy of having a great portfolio... that will continue after the iPhone is no longer exclusive to us," de la Vega said. "We think we will continue after the iPhone... to drive (results)."
He went on to note that new subscribers from the iPhone amounted to one-third the total from all devices. He noted that the company's continued roll-out of High Speed Packet Access 7.2 technology in a half-dozen cities by year's end will put it in a strong position going forward.
"Even if we lose exclusivity, we will be the only carrier with HSPA 7.2 and (new devices) will work on our network faster," de la Vega said. ?I feel as strongly as ever (about the capability of devices in our lineup."
In recent months, Apple's one-carrier-per-country arrangements have begun to fade away, with multi-company agreements reached in the U.K.. Earlier this month, two wireless carriers in Canada confirmed they would carry the iPhone as well. And Apple's agreement with China Unicom to sell the iPhone is non-exclusive as the handset maker hopes to strike a second deal with China Mobile.
Numerous reports have suggested that Apple could jump to competitor Verizon in the U.S. when the exclusive agreement with AT&T concludes in 2010. However, Verizon's recently announced partnership with Google Android and Apple spoofing ads of late have cooled that speculation.
AT&T reported a 2 million increase in total wireless subscribers, which was the highest third-quarter gain in company history. The nation's second-largest wireless carrier now has 81.6 million subscribers.
Of the 3.2 million iPhone activations, nearly 40 percent were customers who were new to AT&T.
The Dallas, Tex., company reported $0.54 diluted earnings per share, down slightly from the $0.55 recorded in the quarter one year prior. Average monthly revenues per subscriber increased 3.8 percent year-over-year, and represented the seventh consecutive quarter with a year-over-year increase in postpaid ARPU.
While the strength of the iPhone helped AT&T beat profit expectations on Wall Street, the company's CEO admitted Thursday that AT&T will not have exclusive access to Apple's handset forever. According to Macworld, Ralph de la Vega said during a question-and-answer session that he believes his company's portfolio will survive after the iPhone moves to other carriers.
"We have a legacy of having a great portfolio... that will continue after the iPhone is no longer exclusive to us," de la Vega said. "We think we will continue after the iPhone... to drive (results)."
He went on to note that new subscribers from the iPhone amounted to one-third the total from all devices. He noted that the company's continued roll-out of High Speed Packet Access 7.2 technology in a half-dozen cities by year's end will put it in a strong position going forward.
"Even if we lose exclusivity, we will be the only carrier with HSPA 7.2 and (new devices) will work on our network faster," de la Vega said. ?I feel as strongly as ever (about the capability of devices in our lineup."
In recent months, Apple's one-carrier-per-country arrangements have begun to fade away, with multi-company agreements reached in the U.K.. Earlier this month, two wireless carriers in Canada confirmed they would carry the iPhone as well. And Apple's agreement with China Unicom to sell the iPhone is non-exclusive as the handset maker hopes to strike a second deal with China Mobile.
Numerous reports have suggested that Apple could jump to competitor Verizon in the U.S. when the exclusive agreement with AT&T concludes in 2010. However, Verizon's recently announced partnership with Google Android and Apple spoofing ads of late have cooled that speculation.
Comments
"We have a legacy of having a great portfolio... that will continue after the iPhone is no longer exclusive to us," de la Vega said. "We think we will continue after the iPhone... to drive (results)."
And what exactly did the reporters expect him to say?!?!
"HOLY HELL WE'VE GOT AN ENORMOUS SHIT-STORM UP AHEAD AND IT AIN'T GONNA BE PURDY!! (pst.. call my broker as soon as we're done with these fools okay?)"
Please don't thread jack
The people making these predictions don't get it. More gizmos != more productivity.
I'm sure a toaster with an LCD screen progress meter and 30 customization buttons would look like a killer product, but in the end, people just want to make toast. If you want to sell a premium toaster, sell one that makes the best toast for the least hassle.
It seems this message is lost on device manufacturers, who just want to make their checkboxed feature list longer than Apple's.
How are they selling all these iPhones when they don't even have Blu-Ray support?????
Ah... what does Blu-Ray have to do with the iPhone???
Ah... what does Blu-Ray have to do with the iPhone???
Ahh humor is lost on the internet.
How are they selling all these iPhones when they don't even have Blu-Ray support?????
What???????? care to rephrase? what do iphones have to do with BD? I there sarcasm in there that I didn't pick up on?
I wonder if many of the newbees jumped from Verizon like myself? Hence their newly developed Apple/At&T commercials.
Not many.
Out of the 2 million new customers, 800K came from wholesale MVNO subscribers (Tracfone). So AT&T gained only 1.2 million retail subscribers.
Verizon is probably going to announce that they gained 1.2-1.3 million retail subscribers in Q3 on Monday (and 95% of them are postpaid). A virtual tie between the two carriers.
I'm sure a toaster with an LCD screen progress meter and 30 customization buttons would look like a killer product, but in the end, people just want to make toast. If you want to sell a premium toaster, sell one that makes the best toast for the least hassle.
My last two toasters have had LCD screens, an array of buttons, and serious feature lists. I bought the first one. My wife surprised me with the second one. I wish she hadn't. They've both been less useful than one with a simple knob to turn. You, sir, win the "Excellence in Metaphory" award of the day.
Ahh humor is lost on the internet.
Oh... that was humor??? .
Bell and Telus rolled out a Canada-wide HSPDA+ network in less than one year. Canada's bigger and much less dense than the US. Seriously, if they can go national, what the heck is AT&T doing that's taking them so long?
I'm starting to understand the frustration you have with these guys.
Maury
My last two toasters have had LCD screens, an array of buttons, and serious feature lists. I bought the first one. My wife surprised me with the second one. I wish she hadn't. They've both been less useful than one with a simple knob to turn. You, sir, win the "Excellence in Metaphory" award of the day.
Thanks. I think Steve Jobs really stated it well during the 2007 iPhone launch: the killer app of a cell phone is making phone calls.
Know the purpose of your product, and stick within the scope of that purpose.
Oh... that was humor??? .
Its called sarcasm. You apparently don't understand whom its directed to. But thats ok
de la Vega might be priming investors for the loss of iPhone exclusivity in 2010, so that when the news actually hits, it won't negatively impact the company's stock pricing as much as if it just came out of the blue that AT&T's exclusivity period with the iPhone was over.
Obviously, Verizon is taking it to AT&T where it really hurts -- network coverage. But Verizon is also hedging by adding Android-powered phones, plus new offerings by Blackberry, as a response to iPhone. Whether that's a weak or strong response is debatable. It should also be pointed out that the "Droid Does" commercial isn't from Verizon, but Motorola, so Verizon's really not doing anything to incur Apple's wrath.
Besides the technical feasibility of an iPhone on the Verizon network, the whole thing comes down to dollars. Is it worth it for AT&T to continue subsidizing each iPhone subscriber plus whatever other financial considerations they're giving Apple? Is it in Apple's financial interest to leave exclusivity with AT&T and build a CDMA capable iPhone to tap into Verizon's audience? Is it worth it for Verizon to give up a lot of control plus pony up a lot of money to Apple to have the iPhone?
When Verizon launches LTE in 2011, along with T-Mobile and AT&T, sure, iPhone will jump to them. But certainly not before then, and it's a mark of incredible ignorance on the part of these analysts to think otherwise.
Both Verizon and Sprint do not support simultaneous web access and voice calls. If you are doing anything on the network and a phone call comes in, you lose the connections.
Although it wouldn't be difficult to just use VOIP for all iPhone calls -- seems to me the most logical solution.
Another first and a sign that going with Verizon would have been a mistake.