The numbers tell the story.
AT&T is losing ground in the battle for new wireless phone customers, and Verizon Wireless is only getting bigger.
According to an Associated Press report, Verizon signed 501,000 new customers to data plan contracts in the first quarter, compared with only a net gain of 187,000 new contracts for AT&T in the January to March period.
Almost all of the new AT&T contracts were for the iPad tablet, instead of the more lucrative iPhone smartphone. Companies make more money off smartphone subscribers with data plans, who often pay more than $100 monthly, than tablet subscribers, who can pay $15 to $50 a month.
Most of Verizon’s new contracts were for wireless phone customers. Verizon began selling the iPhone a year ago.
“Over the last five quarters, Verizon has added nearly three times as many contract subscribers as AT&T,” the AP report says. For perspective, the two split new subscribers nearly evenly over the previous two years.
AT&T, the first to offer the iPhone through an exclusive agreement with Apple before Verizon and others were allowed to sell it, activated more phones last quarter, but not nearly as much as in the previous quarter. The company said it activated 4.3 million iPhones in the first quarter, compared with 3.5 million in the same period a year ago, but down from 7.6 million the October-to-December quarter.
Still, AT&T posted first-quarter earnings that beat analysts’ estimates on lower smartphone upgrade costs and an increase in wireless data sales due to the iPad. First quarter net income was $3.6 billion, or 60 cents per share, up 5 percent from $3.4 billion, or 57 cents per share, a year earlier.
Could there be a correlation between the slow growth in wireless phone customers and a recent Consumer Reports customer satisfaction survey that gave AT&T the lowest rating of any of the four major mobile carriers in the U.S.? The survey of 66,000 Consumer Reports subscribers put Verizon in the No. 1 spot, followed closely by Sprint, T-Mobile and AT&T.
Or is something else at work?