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AT&T bags 363,000 new customers ... where did THEY come from?

Profit, revenue etc all on the way up – but someone's losing

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AT&T has had a jolly three months, banking $3.8bn in profits and adding 363,000 new contracts. But it remains unclear from whence those new customers have arrived.

Not only is the US's second-biggest network* growing, it's actually growing faster than it used to. AT&T's profit for the same quarter last year was a healthy $3.6bn, so topping by 200 million (on sales of $32.2bn) is an impressive achievement and one which comes from adding new customers as well as squeezing more money out of old ones.

The USA is getting more competitive. T-Mobile's discount offers gained it 685,000 new subscribers in its last quarter, subscribers who were popularly thought to have deserted AT&T, only they didn't. Churn (the rate at which customers leave and others join) is down too; by one per cent of one per cent to 1.07, but any downward trend is a good thing.

So roughly a million Americans have signed contracts with T-Mobile and AT&T, which either points to a population bulge of unprecedented proportions or someone else is losing out.

But AT&T has also got its wireless ARPU (Average Revenue Per User) up to $66.20, which is decent by American standards - about twice what we pay in the UK, as American's pay market rates for mobile data rather than having them subsidised by unsustainable voice revenue as we do.

Increased consumption of data is driven by increased ownership of smartphones, which now comprise 75 per cent of AT&T mobile users, but the company has also benefited from the popularity of its U-Verse broadband/TV offering which has hit ten million subscribers. U-Verse is a bundled offering, for TV, broadband and fixed telephone, though mobile remains out of the mix for the moment at least. ®

* Verizon Wireless, of course, is still very much on top.

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