Verizon Gains While Rivals Churn

A new analyst report from Merrill Lynch has reported that Verizon Wireless remains the USA market leader and exceeded estimates across the board in 1Q06. At an industry level, subscriber growth and revenues were in line to better than expected, but margin disappointed in a few cases. The analyst report is raising its estimates for US wireless industry net additions for 2006 from 21 million to 23 million, for total subscriber growth of 11% and ending industry penetration of 77%.

ARPU declined slightly, by 2.5% year on year, although this is an improvement on the 3% decline in previous quarters. This slowdown is attributed to increasing revenues from data services - which now represent 11% of ARPU in the big five operators.

During Q1, Sprint lost net addition share as its postpaid churn level has remained steady while its competitors have improved. Cingular has lost revenue share owing to its shift to reseller additions. T-Mobile USA's network spending requirements are starting to increase. Verizon Wireless gained share in all categories.

 

"

Posted to the site on 23rd May 2006