Cingular COO Sees More Savings From Network Integration

NEW YORK -(Dow Jones)- Cingular Wireless should see additional savings from the recently completed integration of the AT&T Wireless network, said Chief Operating Officer Ralph de la Vega.

"We're starting to see savings in the markets we integrated early this year," he said during a conference call to discuss Cingular's third-quarter results. "We expect additional savings in the next couple of quarters from the network integration."

Cingular plans to turn off its TDMA network, which was run by AT&T Wireless, in early 2008. There are 3.6 million customers using the old network, or 6% of its customer base. De la Vega said he expects turnover to increase in the near term as it attempts to move the customers onto the Cingular network.

The focus on one network should help Cingular boost margins, he added.

The No. 1 US wireless service provider reported third-quarter net income of $847 million, up from $222 million from a year ago. It generated revenue of $9.55 billion, up from $8.75 billion in the year-earlier period.

Atlanta-based Cingular Wireless, which earlier this month completed the network integration, will take the AT&T Wireless name once AT&T completes its $79.3 billion acquisition of BellSouth to take full control of the wireless carrier. The deal is expected to close later this year.

Cingular added 1.4 million net new subscribers, bringing its customer base to 58.7 million. Monthly average revenue per user rose to $49.76 from $49.65 a year ago and $48.84 in the second quarter.

The rate of customer turnover, meanwhile, was 1.8%, up from 1.7% in the second quarter. Chief Financial Officer Pete Ritcher cited seasonal weakness and the migrating of old AT&T Wireless customers.

-By Roger Cheng, Dow Jones Newswires; 201-938-2020; roger.cheng@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 19th October 2006