AT&T Stays Strong Against Threat of Verizon iPhone

July 22nd, 2011 | by Matew Dow |

NEW YORK – AT&T Inc. saw a rebound in the number of new contract subscribers in the second quarter, showing resilience in the face of competition from Verizon’s iPhone.

The country’s largest telecommunications company said Thursday that it added a net 331,000 new subscribers on contract-based plans, up from a record low of 62,000 in the first quarter.

Verizon Wireless started selling its version of the iPhone on Feb. 10, ending three and half years of exclusivity for AT&T Inc.

For AT&T, retaining iPhone subscribers is crucial, because they pay far more every month than those on other phones.

There’s little sign that the Verizon iPhone is prompting AT&T subscribers to jump ship: AT&T said the number iPhone subscribers leaving them actually declined from the first quarter.

However, AT&T is clearly losing some new customers to Verizon. The 331,000 new subscribers is an improvement from the first quarter, but low compared to last year’s average of 538,000 subscribers per quarter.

AT&T said it activated 3.6 million iPhones in the quarter, the same as the first quarter. But that, too, is a sign that it’s facing competition: in the past two years, AT&T has activated more iPhones in the second quarter than in the first, which is the slowest of the year.

Verizon Communications Inc., which own 55 percent of Verizon Wireless and controls its operations, reports its quarterly results Friday morning.

Financial Solutions