It's been apparent for a long time that the fate of the big carriers will be determined by how well they do in wireless. Still, It's striking to consider how quickly the emphasis has shifted. Quarterly results from Verizon and AT&T this week reinforce the thought that the two big carriers are doing everything they can to accelerate their migration to unwired bandwidth providers.
GigaOm's Colin Gibbs was among many writers reporting on Verizon's results. The company ended up with a negative quarter due to a $3 billion charge related to layoffs in the troubled land line sector. The report disclosed lackluster FiOS additions (153,000 customer adds versus 198,000 during the year-ago quarter) and an addition of 2.2 million premises to its wired fiber project's base of premises it can serve. That increase, he says, is relatively small and suggests that AT&T has taken its foot off the FiOS gas pedal.
Verizon Wireless thrived, however. The organization, which is a joint venture with Vodafone, added a net of 2.2 million customers. That easily outpaced the 1.5 million new customers that analysts predicted and brought the total number of subscribers to 91.2 million. The piece says that average revenue per user (ARPU) from data services increased to $16.24 and is responsible for 31.9 percent of service revenue, an increase more than 5 percent from the year-ago quarter, when revenue was data ARPU was 26.5 percent the revenue.
During its quarterly earnings call, AT&T acknowledged what is universally called substandard wireless service, particularly in Manhattan and San Francisco. The carrier, according to an AP story posted at Boston.com, said it will boost capital spending this year by about $2 billion, at least some of which will go to build new towers and install faster backhaul lines.
But AT&T had a good quarter, despite subscriber grumbling. The story says the carrier added 2.7 million wireless customers and activated 3.1 million iPhones. The iPhone total was the second highest in any quarter since the devices launched, which is especially noteworthy since a new version of the product was not announced during the quarter. AT&T still enjoys an exclusive relationship with Apple on the iPhone.
The carrier imbalance in favor of wireless likely will grow greater this year and next with the release of snazzy devices such as the Nexus One and the iPad and the roll out of Long Term Evolution, the flavor of 4G that will be used by both AT&T and Verizon Wireless.
Connected Planet describes the different approaches to LTE of the two companies. The two companies are nearing launches, with Verizon possibly coming first. AT&T executives are quoted as saying that they will wait for 4G functionality to be integrated into handsets, while Verizon Wireless is using laptop data cards to enable LTE sooner. Indeed, the story says that the remedial work being done by AT&T on its 3G network is aimed at readying things for 4G.
There was nothing particularly surprising about the steady march of wireless that was reflected in the earning calls. In the broader sense, however, it is interesting to consider how far the industry has come on wireless in a short time.