AT&T's Stephens: Purpose of shared data is to attract new devices to network
AT&T Mobility (NYSE:T) is moving toward shared data plans, and while AT&T CFO John Stephens did not outline the specific plans, he did sketch out AT&T's philosophy for such plans.
Speaking at the Nomura U.S. Media and Telecom Summit, Stephens said that, hypothetically, if AT&T could develop a data plan that charged an extra $10 or $15 on top of a smartphone data plan to induce a customer to bring their tablet onto the company's cellular data network instead of simply using Wi-Fi, "people would welcome that. We'd like to do that."
However, using the hypothetical example of his wife and one of his sons both having smartphone plans and then moving to a shared bucket of data, he said that scenario would likely lead to the cancellation of one account, which could hurt revenue. "That, from a finance guy's perspective, is not very exciting," he said. "It seems like the much better idea is to focus on these devices that are not hooked up to the network."
Verizon Wireless (NYSE:VZ) is planning to launched shared data plans this summer, but has not indicated how much it will charge or how the plans will exactly function. The carrier has only said that customers will be able to have multiple devices under a single account and that the plans will be geared toward LTE customers.
AT&T's Stephens also noted that AT&T now counts 25 million usage-based data subscribers, double the number it had a year ago. "This positions us well to capture the revenue opportunity for increases in data usage," he said.
During the first quarter, Stephens noted that 80 percent of all postpaid device sales were smartphones, but that only around 60 percent of AT&T's postpaid subscriber base is currently on a smartphone. That 20 percent difference amounts to 15 million customers for AT&T and he said that when customers upgrade to a smartphone they pay 90 percent more on average per month. Stephen said he thinks AT&T will sell 25 million total smartphones in 2012, including upgrades.
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