Alltel: Ahead of the Market - and Verizon Wireless
The United States’ fifth largest wireless carrier, Alltel, has outpaced the market for the second successive quarter in Q2 2008, registering customer growth of 2.4%, up from 1.5% in 2007. At first glance the result might appear to be true as a sole result of Sprint Nextel’s worsening fortunes, as the US number three recorded its fourth successive net loss of connections in the three month period to June. However, whilst this is a factor, none of the other three large operators came up to scratch in Q2 as far as Alltel was concerned, with Verizon Wireless and T-Mobile only managing growth of 2.2% and AT&T 2.1%. The total base ended Q2 08 at 13.49m.
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Quarterly Growth vs Big Four, Q2 06 - Q2 07
Alltel is currently in the process of being acquired by Verizon Wireless (VZW), and it is notable that connection growth at the smaller business has outperformed that at the larger in both quarters so far this year – and we have to look back more than six years to find the last time that was true. In absolute terms, Alltel’s numbers by no means revolutionise the Verizon business, but the performance will not have gone unnoticed. Alltel’s 320k second quarter net additions made up 17.5% of the combined Alltel/VZW total, taking the contribution for the first half to 19.2%.
In terms of net additions VZW was 0.8% behind market leader AT&T in Q2 08 and only 5% ahead in the first half. However, if Alltel is included the number two player would have been 21.3% ahead in the quarter and 23.7% in the half year. The deal has yet to be formally approved – despite Verizon’s commitment to disposing of 85 overlapping properties to meet regulatory requirements – but completion is expected by the end of the year.
Alltel may have only recently found its form in terms of customer growth, relative to its rivals, but it has long led the industry in terms of ARPU. Q2 2008 was no exception, as the average monthly revenue climbed almost $2.50 clear of its nearest rival to $54.42 per customer, from $54.10 in Q2 2007 and $53.64 in Q1 2008. In terms of voice ARPU, Alltel’s customers are even further ahead, as data made up just 15% of the operator’s Q2 total, against nearer to 25% at VZW and AT&T. Indeed, Alltel’s voice minute usage increased to record levels in the period, reaching 799 minutes per customer per month in the retail business.
Posted to the site on 28th August 2008
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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