iPhone 3G Sales Spur AT&T Wireless Growth in Q4 2008

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Jan 28, 2009.

  1. MacRumors macrumors bot

    MacRumors

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    AT&T today reported financial results from the fourth quarter of 2008 and announced that they had activated 1.9 million new iPhones during the quarter. That number was down from 2.4 million activations in the third quarter, its first full quarter of availability, but was still sufficient to play a significant role in AT&T subscriber growth, which saw an overall net gain of 2.1 million subscribers.

    While iPhone activations result in an up-front hit to AT&T's earnings due to the subsidy provided to Apple, AT&T values new iPhone customers for their extended contracts at a higher average monthly rate than typical wireless subscribers. AT&T also reported that 40% of iPhone activations were to customers who were new to AT&T, a figure consistent with previous results.

    Fortune analyzes how the iPhone has helped drive AT&T's wireless growth:
    Overall, AT&T's wireless revenue rose 13.2% year-over-year and made up 41.4% of AT&T's total revenue, up from 37.4% in the year-ago quarter.

    Article Link: iPhone 3G Sales Spur AT&T Wireless Growth in Q4 2008
     
  2. deannnnn macrumors 68000

    deannnnn

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    It's those increases that are murdering AT&T's network in heavily populated areas.
     
  3. gibbz macrumors 68030

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    Yep. I think they severely underestimated the popularity of the iPhone and its impact on their network.
     
  4. NoExpectations macrumors 6502a

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    Two sides to every story.

    NEW YORK (Reuters) — AT&T (T), the top U.S. phone company, said fourth-quarter profit fell despite higher wireless sales as it paid high subsidies to support Apple's popular iPhone.

    So...that is where a good chunk of our $30 monthly fee goes....right to Apple.
     
  5. elppa macrumors 68040

    elppa

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    Is this a sign Apple learning to make partners better?
     
  6. Sbrocket macrumors 65816

    Sbrocket

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    Even if that were true, what would be wrong with that?

    In any case, the subsidies being referred to are the subsidies on the hardware being initially purchased, hence why the article mentions the up-front hit to AT&T's earnings to pay the subsidies. That doesn't mean that Apple gets cuts of the monthly fees - that would be silly.
     
  7. marine610610 macrumors regular

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    Better news would be that ATT is not doing so well with the iPhone, then maybe we would see a new carrier pick it up sooner.
     
  8. Eduardo1971 macrumors 65816

    Eduardo1971

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    The churn rate -- the percentage of customers who drop AT&T's service -- among iPhone owners is significantly lower than the rest of the network, sharply reducing marketing costs.

    Of course. If one leaves AT&T, you are left with a useless phone. One cannot legally leave AT&T for another mobile phone carrier.

    AT&T should include text messaging in their monthly fees. Ugh:mad:

    {yes, am aware of jail breaking the phone but I'm just bugged at AT&T's iphone fees}
     
  9. Sbrocket macrumors 65816

    Sbrocket

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    Yeah, that makes sense - the first exclusive carrier doesn't do well with the iPhone, so other carriers will just be jumping on for a slice of the limited pie, right? Come on, think before you say stuff like this. If anything, you want the iPhone to be a success so that other carriers will have an interest in bringing it to their network once the exclusivity contract is up.
     
  10. The Tall One macrumors regular

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    The lesser of five evils. I switched from Sprint to AT&T because of the iPhone, not because of AT&T. I really hope that AT&T remembers this.
     
  11. motulist macrumors 601

    motulist

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    2011? I forget when att is supposed to lose its exclusivity to the iphone. I seem to remember it being 2011, but I can't remember exactly. Does anyone else remember when att iphone exclusivity contract ends?
     
  12. MacVixen macrumors 6502

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    How long is the exclusivity contract with AT&T? I'm.... living with AT&T..., but was soooooo much happier with Verizon. I'd love to see the iPhone available on other networks... I'd leave MaBell in a heartbeat
     
  13. Eduardo1971 macrumors 65816

    Eduardo1971

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    I wish-at the end of the day were are just another number to them.

    Geez, I really dislike AT&T.:mad:
     
  14. ambhci macrumors newbie

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    Other Vendors

    I think it will be great when there are other carriers for the Iphone. Competition has a way of driving prices down. When there is no competition (only one player) they can charge whatever they like... I love my Iphone...
     
  15. e-coli macrumors 68000

    e-coli

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    Great. Can we have tethering now?

    Apple will never make a CDMA iPhone. We're the only country on earth to still use this outdated tech.
     
  16. kas23 macrumors 603

    kas23

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    Based on this, I really wonder if AT&T is going to win out in the end. They are losing profit, but say that in the end, they are gaining customers, which will pay off in the future for them. However, the 40% new customers are probably switching to AT&T due to the iPhone, not due to AT&T. Myself, as soon as the iPhone can be had on any other carrier, buh-bye AT&T! I will likely go for the cheapest plan, which will mean back to Sprint for me (assuming a CDMA version is produced, which will happen since Apple is not going to ignore the largest population of cellphone users in the US - Verizon).
     
  17. Arcadie macrumors regular

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    What wrong with AT&T? i love them compared to verizon in terms of coverage and call quality.. But maybe its just better were i live and verizon may be better were you guys live. But here in tampa, AT&T seems to have much better reception and signal...
     
  18. kas23 macrumors 603

    kas23

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    The problem with AT&T, at least for me, is their plans - they're too expensive. I came over from Sprint just for the iPhone. Now, due to this switch, I am paying much more money, for less service. I now have to pay for texting, where I didn't before. My nights now start at 9pm, where they started at 6pm with Sprint. The thing is, in terms of quality of the network, I really see no difference. In terms of customer service, I also see no difference - they're all bastards whose main goal is to cheat you out of money.
     
  19. kas23 macrumors 603

    kas23

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    Yeah they will. In fact, I bet they already have one developed. Remember, Apple offered the iPhone to Verizon first, so they are in fact very willing to produce a CDMA phone. In addition, most of the iPhones sold in the world are to US customers. Do you really think that Apple plans on turning their back on the largest cellphone carrier in the US? No, Verizon's customers represent too much revenue for Apple for them to be snubbed.
     
  20. NoExpectations macrumors 6502a

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    My point is that Apple isn't 100% innocent when it comes to AT&T's high rates. The money that goes to Apple has to come from somewhere....and guess where? You and me.
     
  21. SummerBoy macrumors regular

    SummerBoy

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    then don't use it !
     
  22. kas23 macrumors 603

    kas23

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    Then don't use what? An iPhone on AT&T? As I pointed out earlier, I went to AT&T for the iPhone. Tell me, how can I use my iPhone 3G without AT&T? You really have to use your brain before posting some half-wit comment.
     
  23. Dmac77 macrumors 68020

    Dmac77

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    I don't understand why people bitch about AT&T so much. We just switched from Verizon in December, and we are having a much better experience with AT&T then we did with Verizon. AT&T is 1000x better then Verizon ever will be.

    Don
     
  24. dejo Moderator

    dejo

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    Not so silly, perhaps?
     
  25. iFan macrumors newbie

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    work for AT&T..

    I work for AT&T and can promise you that not a single penny of your $30 data plan goes to Apple. The subsidy paid to Apple is from the upfront hardware sale. For example, if you buy an iPhone for $199, the real cost to AT&T is actually $575. If you buy an Iphone for $299, the real cost to AT&T is $675. The $375 difference is the 'subsidy' that is paid to Apple for EVERY iphone sold in the U.S. This is part of why AT&T's profits fell. It's a GREAT deal for Apple, though!

    Most phones at AT&T are subsidized by between $50 and $150 dollars. The Blackberry Bold's subsidy is on the high end at $150. No other phone comes close to the iPhone's $375 subsidy.
     

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