The downward spiral of wireless carrier business has begun. The Number Portability is going to be a darwinian force. And here are some early signs of an industry in distress.
Many of you have been following my continued coverage of the impact of wireless number portability. My Business 2.0 story raised the all important issue of how Ïnumber portabilityÓ effects the finances of the phone companies. Well my take is mostly negative, and now there are others who are coming to that conclusion as well.
Today, NJ-based Probe Financial Associates (PFA), out out a research report which says that the local number portability (LNP) will bring pressure to those US carriers that cannot offer a full range of services. Admittedly it is a really poorly worded press release and does not get the message across, though it asks the all-important question: Can wireless carriers remain independent.
In continuation of bad news, my friends from RBC Capital Markets sent me a report. Here are the highlights
* October Gross Adds Slower. Sector gross adds appeared down in October vs. 3Q monthly averages. On a relative basis, our checks suggest Verizon and Nextel continued strong while PCS continued to grow at a slower pace and Cingular showed signs of slowing down.
* 4Q Price Competition Continues. Yesterday, Cingular added 500 bonus minutes to its Rollover Minutes feature. Also, as widely reported, T-Mobile added a weekend-calling feature that includes Friday calls. These steps follow modestly competitive pricing moves by PCS and AWE that we summarized on 10/13. However, the overall order of carrier pricing remains intact at the $40-60/month levels: VZ, NXTL, and PCS continue to price less aggressively than AWE, Cingular, and T-Mobile. (Complete analysis of Cell Phone prices coming soon!)
To me those are signs of an increasingly despondent industry.
Some hot phone deals for now
With the Number portability around the corner, the consumers can take advantage of the desperation of the carriers and find some great deals on their phone call plans. Here are highlights of some of the best deals on offer.
* Cingular: Rollover feature plus 500 additional bonus minutes for new subscribers taking plans at $40 or higher. The additional minutes can apply anytime during the first year of service.
*ðT-Mobile: T-Mobile added a $40/600 calling plan whereby weekend minutes apply during Friday as well Saturday and Sunday.
* AT&T Wireless: In the business segment, ATTWS has increased the number of minute-pooling options for corporate customers, enabling large blocks of subscribers to share a large minute bucket.