Monday, April 4, 2011

http://www.tgdaily.com/business-and-law-features/41239-apples-iphone-3g-saves-att-from-recession

AT&T did pretty well when in the recession. However, at the start of the recession, AT&T was losing revenue fast and was about to “drop the ball” because they were selling wired telecommunications products. Revenues were dropping at a dramatic rate as large amount of customers were switching from wired to wireless telecom, and it was Apple’s Iphone 3G that prevented the downfall of AT&T. by the end of 2008, AT&T lost a total of 6 million landlines. Broadband services also dipped to 236,000 from 396,000 a year before. For AT&T, “Wireless business made up for the landline decline.” By the fourth quarter of 2008 (period ending December 31, 2008), AT&T added about 2.1 million new wireless subscribers in the quarter which was down 2.7 million a year before. Slow growth was due to the matured market since everyone had at least one cell phone at the time with a service plan. 90% of new subscribers came to AT&T though, because of Apple’s Iphone 3G.
Wired and Wireless performance, combined with layoff expenses, subsidies, and the Iphone 3G, allowed AT&T to experience a slight 2.4% increase in quarterly revenue, but 23% drop in net income (remember the dying wired telecommunications industry).

Quaterly-2008
Revenue: was up 2.4% from 30.4 billion to 31.1 billion.

Annually-2007/8
Revenue climbed up 4.3% from last year to $124 billion.

Rtsmith

1 comment:

rk5767a said...

It is interesting how 90% of new subscribers came to AT&T because of Apple's 3G Iphone but it also is not surprising. I wonder if people will switch back to Verizon since they now have the Iphone. Now that AT&T purchased T-Mobile, it is evident that their wireless users will increase. I wonder if the T-Mobile users will subscribe to AT&T after their contracts are up with T-Mobile. How do you think this is going to affect Verizon?