Close
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Apple
    • Apple
    • Applications
    • Mobile
    • Networking

    Apple’s iPhone Bails Out ATandT

    By
    Roy Mark
    -
    April 22, 2009
    Share
    Facebook
    Twitter
    Linkedin

      There’s a good reason why AT&T is anxious to renew its deal with Apple to be exclusive U.S. carrier of the iPhone: it’s a difference maker for the telecommunications giant as AT&T’s first quarter results show.

      Hammered again by declining landline subscribers, AT&T’s overall first-quarter profit dropped 9.7 percent from a year ago, but the company’s wireless division — driven by new iPhone subscribers — recorded a net gain of 1.2 million subscribers. AT&T said 875,000 of the new wireless subs signed contracts, a very healthy 24.1 increase from the first quarter of 2008.

      AT&T also reported 1.6 million iPhone activations during the quarter and overall wireless data revenue increased 38.6 percent to $3.2 billion. The growth primarily came from data hungry iPhone customers accessing the Internet for Web surfing, messaging and e-mail.
      Analysts eagerly awaited the company’s first quarter numbers to see if the so-called “iPhone effect” would fade for AT&T. A number of analysts had speculated that AT&T’s heavy subsidies of the iPhone would eventually take its toll, but AT&T said the data subscriptions were worth the subsidies.
      “We said that our upfront investment in iPhone customers would depress margins in the short-term,” AT&T Chief Financial Officer Rick Lindner said on a conference call. “But given the attractive customer profile, it would support margins in the quarters and years ahead, and that’s what you see in our first quarter results.”
      AT&T offers iPhone subsidies for customers signing two-year contracts that include Internet data plans that sell for approximately $70. Under the contracts, an 8GB iPhone sells for $199 and the 16GB version goes for a subsidized $299. Without a contract, the 8GB model retails for $599 and the 16GB iPhone for $699.
      Overall, AT&T recorded a 13 percent increase in wireless profits and a nearly 9 percent gain in wireless revenues. The company also said customer churn among smartphone owners was only 1.2 percent.
      “AT&T is well positioned for the next wave of wireless growth,” said Lindner. “The foundation is a strong spectrum position … second is great device lineups with exclusives like the iPhone and BlackBerry Storm.”
      In last year’s auction by the FCC, AT&T paid $6.6 billion for a swath of spectrum to pave the way for the company’s move into 3G and 4G markets. The spectrum will come from airwaves being deserted by television broadcasters as part of the digital television transition.
      AT&T refused to speculate on rumors of a new iPhone release sometime this summer, nor did the company comment on the ongoing negotiations between AT&T and Apple to keep its exclusive iPhone contract.

      Roy Mark

      MOST POPULAR ARTICLES

      Cybersecurity

      Visa’s Michael Jabbara on Cybersecurity and Digital...

      James Maguire - May 17, 2022 0
      I spoke with Michael Jabbara, VP and Global Head of Fraud Services at Visa, about the cybersecurity technology used to ensure the safe transfer...
      Read more
      Cloud

      Yotascale CEO Asim Razzaq on Controlling Multicloud...

      James Maguire - May 5, 2022 0
      Asim Razzaq, CEO of Yotascale, provides guidance on understanding—and containing—the complex cost structure of multicloud computing. Among the topics we covered:  As you survey the...
      Read more
      Big Data and Analytics

      GoodData CEO Roman Stanek on Business Intelligence...

      James Maguire - May 4, 2022 0
      I spoke with Roman Stanek, CEO of GoodData, about business intelligence, data as a service, and the frustration that many executives have with data...
      Read more
      Applications

      Cisco’s Thimaya Subaiya on Customer Experience in...

      James Maguire - May 10, 2022 0
      I spoke with Thimaya Subaiya, SVP and GM of Global Customer Experience at Cisco, about the factors that create good customer experience – and...
      Read more
      IT Management

      Intuit’s Nhung Ho on AI for the...

      James Maguire - May 13, 2022 0
      I spoke with Nhung Ho, Vice President of AI at Intuit, about adoption of AI in the small and medium-sized business market, and how...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2021 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×