Cingular Adds 2.4M Subscribers; Data Use Grows

by Emily Burg, Jan 25, 2007, 5:00 AM

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Cingular Wireless, now the wireless arm of AT&T, yesterday reported that the holiday quarter was its best ever for net subscriber additions. Chairman and CEO Stan Sigman expressed optimism for this year as the brand converts to AT&T and gains new cachet from its connection with release of the iPhone, for which it is the exclusive wireless carrier.

Cingular added 2.4 million customers during the key holiday retail season, compared with 1.8 million customer additions in the year-ago quarter and 1.4 million in the third quarter of 2006, the company reported. Cingular ended the quarter with 61 million subscribers--a year-over-year increase of 6.8 million customers.

The company saw no change in subscriber churn for either post-paid or monthly customers from the third quarter of 2006, but did see a reduction in both categories from the year-ago quarter, which Chief Financial Officer Pete Ritcher said was a sign of customer satisfaction with increased customer service and product offerings.

This is the last quarter that Cingular will report earnings independently. It will report earnings as a part of parent company AT&T in future quarters.

Commenting on the transition from Cingular to AT&T which is currently underway, Sigman said, "We are excited to get behind the well-known and respected AT&T brand. While no brand transition is easy, we have done it many times before, we know how to do it and we know how to do it well."

Average revenue per user increased to $49.29, a 0.8% increase from the year-ago quarter, but a drop from $49.76 in the third quarter of 2007.

However, data revenue per user grew by 53% year-over-year to $7.19. The company had 32 million active data customers and delivered more than 12 billion text messages.

The company was very enthusiastic about the data numbers, especially with its plan to continue a focus on music and data-driven products in 2007.

"Since introducing the [Motorola] RAZR just after the close of the AT&T wireless merger, we have been known as the leader of delivering compelling wireless products and services to the marketplace," Sigman said.

That reputation has been bolstered by the partnership with Apple to distribute the iPhone, Sigman said, expressing his enthusiasm for the product and predicting it will sell very well. Sigman also highlighted the success of Cingular's aggressive focus on music in 2006, which he believes will be further complemented by product offerings like the iPhone in 2007.

"Our music strategy has been well received," Sigman said. "Customers enjoy their music their way, whether customers want to get their music from CDs, iTunes, Napster. We support it all."

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