Why AT&T loves Apple’s iPhone 3G

“Today when you visit AT&T Mobility’s website, a promo for the iPhone 3G (‘Now Available Online!’) is often the first thing that pops up — and based on the fourth quarter results the company released Wednesday, you can see why,” Philip Elmer-DeWitt reports for Fortune. “Q4 revenues were up 2.4% (to $31.1 billion) in a tough economic climate thanks to results in the wireless division that CEO Randall Stephenson attributed largely to the iPhone… ‘The success of our iPhone 3G launch has driven wireless growth and helped redefine the wireless data space,’ CEO Randall Stephenson said in a press release.”

Elmer-DeWitt reports,” How did the iPhone do that? Let us count the ways:”

1. AT&T has activated 4.3 million iPhone 3Gs since its launch, 1.9 million in Q4 alone — more than double its iPhone activations one year earlier.
2. The average revenue from Phone users is 60% higher than the typical AT&T customer — thanks to that $30 per month data fee. Their heavy use of Web services helped drive AT&T wireless data use up 51.2% year to year, which as reader Jon in Brentwood, Calif., points out is not necessarily a good thing.
3. About 40% of the iPhone activations this quarter were new AT&T customers, either buying their first cellphone or switching from another carrier.
4. The churn rate — the percentage of customers who drop AT&T’s service — among iPhone owners is significantly lower than the rest of the network, sharply reducing marketing costs.

Full article here.

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