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US Small Operators Q2 - Customer Growth Falls but Mixed Results for ARPU
The US market has undergone some consolidation recently, but there remain seven operators with between 250k and 10m subscribers. The largest of these is US Cellular, which finished Q2 08 with 6.19m subscribers. Three others had more than 1m customers: MetroPCS (4.60m), Leap (3.31m) and Centennial (1.09m). Qwest, which recently started selling Verizon Wireless plans having terminated its contract with Sprint, had 0.81m at the end of the quarter. Finally, regional players Cincinnati Bell and Ntelos had 0.58m and 0.43m respectively.
In total, these seven operators had just over 17m customers at the end of Q2 08, compared to 15.09m a year earlier. This represents a growth rate of 12.7%, down from 16.3% for the prior twelve months. However, only two operators actually managed to exceed the Q2 08 average growth rate, with Leap recording 23.6% annual growth and MetroPCS 29.5%. They remain the two fastest-growing operators on the US market, although both have seen a decline in growth, with LeapĂ's rate down 22.1pp compared to Q2 07 and MetroPCS seeing a 17.3pp fall. Indeed, Centennial was the only one of the seven small operators to see an improvement in growth - if we can call it that, since the comparative figures were -20.3% for Q2 07 and -0.9% for Q2 08.
Meanwhile, Ntelos was down 2.8pp to 8.9%, Cincinnati Bell down 5.3pp to 3.5%, US Cellular down 2.3pp to 3.1% and Qwest down 3.4pp to 0.5%. The economic downturn is certainly a factor here, with a noticeable decline in growth over the past year at many of these operators.
On the other hand, ARPU figures were up at a majority of the seven. Qwest saw a $3 improvement to $55, US Cellular was up $2.13 to $49.87 and Cincinnati Bell gained $2.23 to $41.24. Meanwhile, Qwest recorded an ARPU of $72 for the three months ending 31st May (the fourth quarter of its fiscal year) compared to $68 for the year-earlier quarter. It is noticeable that these were the four operators with the lowest customer growth rates. By contrast, MetroPCS - the fastest growing - saw a $1.41 decline in ARPU to $41.77. Leap was down $0.78 to $43.97 and Ntelos down $1.53 to $54.58.
Posted to the site on 13th August 2008
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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