AT&T likes to brag, especially about wireless data. I listened to their 4Q08 conference call, and if I had a nickel for every time they mentioned their exceptional wireless data results, well … They do have some reason to cheer. They activated 1.9 million iPhone 3G subscriptions in 4Q08. That’s down from 3Q08 (the first full quarter of iPhone 3G availability), but more than double 4Q07. That’s good news for them, because iPhone users spend 1.6x more per month, on average, than regular wireless subscribers. Those numbers helped fuel wireless data growth of 51.2% over 4Q07. AT&T also took a couple shots at Verizon, who is executing on wireless quite well despite not having the iPhone ‘dividend’ that AT&T enjoys. They made several references to AT&T’s 100% ownership of their wireless business – which I interpret as a shot at Verizon’s joint ownership of Verizon Wireless with Vodafone.
AT&T is also proud of U-Verse. They added 264k U-Verse TV subscribers in 4Q08 to reach a total of 1.046 million. They claim ‘mid-teens’ penetration rates, but don’t offer a lot of insight into penetration figures. They also claim 90%+ ‘attach rate’ of broadband service to U-Verse TV customers. Wireline losses continue, with AT&T losing 850k wireline connections in 4Q08. They added 236k wired broadband customers, and now claim just over 15 million wired broadband customers. “We feel very good about the competitiveness of our broadband product,” said AT&T CEO Randall Stephenson. They also added 121k 3G LaptopConnect broadband customers in the quarter, and now claim 1.2 million 3G broadband customers. AT&T started combining wired broadband and 3G broadband customers into a ‘total’ broadband customer metric in 3Q08. That combined number for end of year 2008 stands at 16.3 million.
Other AT&T highlights for 4Q08 include:
- Total consolidated revenues of $31.1 billion, up 2.4 percent versus reported results in the year-earlier quarter and up 2.2 percent compared with fourth-quarter 2007 pro forma revenues
- Net income totaled $2.4 billion versus $3.1 billion in the year-earlier quarter, and reported earnings per diluted share totaled $0.41, compared with $0.51 in the fourth quarter of 2007
- 2.1 Million net gain in wireless subscribers, to reach 77.0 million total in service. Retail postpaid net adds topped 1.3 million, up 13.9 percent versus results in the year-earlier quarter
- 1.9 Million Apple iPhone 3G activations, 40% of which came from outside of existing AT&T customer base
- 14.2 percent growth in wireline IP data revenues
- Consumer IP data revenues, which include broadband and AT&T U-verse services, grew 21.4 percent, and retail business IP data revenues grew 11.4 percent. IP services now account for 45.2 percent of AT&T’s total wireline data revenues