AT&T Activates 3.2 Million iPhones in Q2 as New Customer Draw Slows

[MacRumors]

AT&T today announced its financial results for the second quarter of 2010, noting activations of 3.2 million iPhones during the quarter, a new company record. The strong iPhone 4 release at the very end of the quarter, however, skewed sales toward existing AT&T customers upgrading their handsets rather than customers new to the carrier, with only 27% of this quarter's iPhone purchasers being new to AT&T, down from "more than one-third" in the previous quarter and a steady 40% number in even earlier quarters.

On June 24, AT&T began offering iPhone 4, the most powerful iPhone yet. Preorder sales of iPhone 4 were 10 times higher than the first day of preordering for iPhone 3GS a year earlier. For the full second quarter, AT&T iPhone activations totaled 3.2 million, the most quarterly iPhone activations ever. Approximately 27 percent of those activations were for customers who were new to AT&T.

The company noted that despite the volume of the iPhone 4 launch, it was able to expand profit margins in its wireless segment while also reducing customer churn to "best-ever" levels of 1.01% for postpaid customers and 1.29% overall.

AT&T has noted in the past that "activations" reported during a quarter include previously-sold devices being reactivated by new customers, such as when an older-model iPhone is passed down to a relative or sold. Consequently, comparisons between AT&T's iPhone activation data and Apple's device sales numbers are not valid.

AT&T has been widely-rumored to be losing its exclusivity for the iPhone in the United States within the next few months, with Verizon and now T-Mobile being popular targets for expansion rumors. Apple noted in its own earnings conference call earlier this week that it is moving away from an exclusive carrier relationship in Spain, leaving the U.S. (AT&T) and Germany (T-Mobile) as the company's only major markets still seeing exclusive carriers.

Article Link: AT&T Activates 3.2 Million iPhones in Q2 as New Customer Draw Slows

 

[jroadley]

I think its Amazing that in the US these things are still only officially available on AT&T (Who sound rubbish by the way).

UK have got it spot on... give the user the choice of their favourite network.

 

[The Wedge]

Now fix the network

 

[barkomatic]

Give it a few more quarters and they will losing customers--and that's not even considering the possibility that the iPhone may go to Verizon.

 

[badpinoy]

I think its Amazing that in the US these things are still only officially available on AT&T (Who sound rubbish by the way).

UK have got it spot on... give the user the choice of their favourite network.

the only other network in the US that can use the GSM network is T-Mobile. ATT > T-Mobile.

 

[DoNoHarm]

ABAAT - Anything But AT&T

 

[macintologist]

If Apple makes a CDMA phone I really hope it's a dual-band phone that can work on both GSM and CDMA.

 

[NoExpectations]

...and Verizon refused the 1st iPhone offer from Apple....business blunder of the decade.

 

[oahazmatt]

I think its Amazing that in the US these things are still only officially available on AT&T (Who sound rubbish by the way).

UK have got it spot on... give the user the choice of their favourite network.

This isn't new. Back when AT&T Wireless was Cingular, the Razr was an exclusive phone for about a year or so. And right now the Droid X is exclusive to Verizon. It doesn't stop at cell phones, either. In my area, there's a very popular regional news network that's exclusive to one cable provider.

I've never had a problem with it. I've heard people complain that its not fair for whatever reason, even people in government trying to question the exclusivity, but only in regard to the iPhone. Exclusive agreements are common. Are they fair? It depends on your point of view. Are they ideal? It depends on if it meets your needs. Caveat emptor and all that.

 

[schwell]

Give it a few more quarters and they will losing customers--and that's not even considering the possibility that the iPhone may go to Verizon.

Not likely.

 

[macerroneous]

Hand-me-downs

This is a new phenomenon to me. "give my 3GS to Billy and I get the 4". It must have happened in significant numbers this quarter. It's a great deal for ATT since they get 2 monthly data streams but only have 1 subsidy to pay back to apple. I wonder if this was another reason for ATT to allow early upgrade? And meanwhile, when the 3GS dies, there's one more addict for apple to feed. Does anyone know the average lifespan of an iPhone? My family has had 8 and so far the longest we've gone with one is 15 months. (apple has always provided a nice refurb - except for the ocean kayak incident)

 

[101AirAssault]

You people have been forecasting AT&T's demise for years yet they're still around and going strong. Jroadley you have no clue, some things are better left unsaid 😉
I wish iPhone would go to other carriers in the states so people would stop whining about AT&T and could start whining about their new carrier. (because that's what these people do) I've never understood why people stay with a provider that isn't providing the service they expect. Pretty stupid if you ask me.

My AT&T service is top notch and I couldn't be happier. Keep up the good work AT&T and keep laughing at those that continue to predict your downfall.

...and Verizon refused the 1st iPhone offer from Apple....business blunder of the decade.

Agree 100% Vrz had their chance and pissed it away. Would be funny if apple went with t-mo over vrz for new iPhone carrier.

 

[jpn]

japan is a one official carrier market as well

one more major market is also locked to one carrier only: japan, on softbank.

 

[thetaylor13]

ABAAT - Anything But AT&T

I think something may be wrong here....

 

[NoExpectations]

Now fix the network

Lowest churn in the industry, no one is leaving AT&T. I think what we have here are a few vocal bloggers who are unhappy (or who have a hidden agenda).

The same is true regarding the iPhone 4 Antenna issue. If you read the popular Apple Blogs, it appeared that "everyone" was having problems....reality was quite the opposite. Numbers don't lie.

 

[epictempo]

...and Verizon refused the 1st iPhone offer from Apple....business blunder of the decade.

Too much pride on both ends lol. Verizon just will not get the iPhone, especially with the constant ads that disses the iPhone.

 

[ten-oak-druid]

Nokia Earnings Fall as Apple IPhone Competition Increases
By Diana ben-Aaron - Jul 22, 2010
http://www.bloomberg.com/news/2010-...ls-as-apple-iphone-competition-increases.html

"Nokia Oyj, the world’s biggest maker of mobile phones, posted a steeper-than-expected 40 percent drop in second-quarter profit on competition from Apple Inc.’s iPhone and devices based on Google Inc.’s Android software.

Net income fell to 227 million euros ($291 million), or 6 cents a share, from 380 million euros, or 10 cents, a year earlier, after Nokia last month cut forecasts for the period’s revenue and margins. Analysts had predicted profit of 285 million euros, according to the average estimates in a Bloomberg survey. Sales rose 0.9 percent to 10 billion euros, the Espoo, Finland-based company said in a statement today.

..."

 

[epictempo]

ABAAT - Anything But AT&T

Maybe its, " Anything But Android And Tmobile" lol jk

 

[powers74]

Alu

This is a new phenomenon to me. "give my 3GS to Billy and I get the 4". It must have happened in significant numbers this quarter. It's a great deal for ATT since they get 2 monthly data streams but only have 1 subsidy to pay back to apple. I wonder if this was another reason for ATT to allow early upgrade? And meanwhile, when the 3GS dies, there's one more addict for apple to feed. Does anyone know the average lifespan of an iPhone? My family has had 8 and so far the longest we've gone with one is 15 months. (apple has always provided a nice refurb - except for the ocean kayak incident)

I know two people with original iPhones - one has a huge crack in the glass. still works fine.

 

[thetaylor13]

You people have been forecasting AT&T's demise for years yet they're still around and going strong. Jroadley you have no clue, some things are better left unsaid 😉
I wish iPhone would go to other carriers in the states so people would stop whining about AT&T and could start whining about their new carrier. (because that's what these people do) I've never understood why people stay with a provider that isn't providing the service they expect. Pretty stupid if you ask me.

My AT&T service is top notch and I couldn't be happier. Keep up the good work AT&T and keep laughing at those that continue to predict your downfall.

Not at all, everything you've said is completely wrong. If I had my iPhone in Columbus, OH this whole time I would love AT&T. But as I lived in San Francisco the last 3 years AT&T was **** and a half. Couldn't do anything ever, unless I was outside. In my living room there was a designated corner I used to make calls because the rest of the house ate my reception away.

There's valid complaints for AT&T, especially when my roommates used Verizon and never had the problems I had. And I can definitely validate the 30-40% drop calls when living in SF.

Now a days I'm in Ohio and everything is perfectly fine, I can't remember the last time I had a drop call since moving here. That doesn't make their network great, it makes me (and you) lucky.

 

[Chupa Chupa]

I think its Amazing that in the US these things are still only officially available on AT&T (Who sound rubbish by the way).

UK have got it spot on... give the user the choice of their favourite network.

Easier said than done. For one all UK cellos use the same cell tech. For another, the largest US cellco is as hard-nosed as Apple when it comes to negotiating and doesn't seem too hot to take the iPhone on Apple's terms.

 

[AlphaBob]

27% New Customers isn't bad

What the analysis fails to examine, when considering that only 27% of the customers are "new", is that many of those 73% "old" customers, such as myself, had fallen off contract and were no longer bound to AT&T. I chose to re-up for another 2 years, rather than seek a different carrier. So I am just as good as a new customer to them -- bound to a 2 year contract.

 

[e-coli]

Pretty safe bet that most people who want an iPhone have one by now. They're reaching the saturation point of the users who get decent AT&T network coverage. They probably won't see an increase until they have broader, more reliable coverage.

 

[Tonewheel]

"Everything he said is completely wrong"???

Not at all, everything you've said is completely wrong. If I had my iPhone in Columbus, OH this whole time I would love AT&T. But as I lived in San Francisco the last 3 years AT&T was **** and a half. Couldn't do anything ever, unless I was outside. In my living room there was a designated corner I used to make calls because the rest of the house ate my reception away.

There's valid complaints for AT&T, especially when my roommates used Verizon and never had the problems I had. And I can definitely validate the 30-40% drop calls when living in SF.

Now a days I'm in Ohio and everything is perfectly fine, I can't remember the last time I had a drop call since moving here. That doesn't make their network great, it makes me (and you) lucky.

Really? Everything he said is completely wrong? Pls reread his post....

 

[kntgsp]

Lowest churn in the industry, no one is leaving AT&T. I think what we have here are a few vocal bloggers who are unhappy (or who have a hidden agenda).

The same is true regarding the iPhone 4 Antenna issue. If you read the popular Apple Blogs, it appeared that "everyone" was having problems....reality was quite the opposite. Numbers don't lie.

Tinfoil much?

Yeesh. Get out more.