05 May More signs of a coming wireless price war
Considering the devastating nature of the economy, the cellphone business had a pretty good first quarter, but all signs are pointing to dark days ahead. Dark days for the carriers, not their customers.
Sprint was the last of the major phone companies to release its financial results. As the distant No. 3 in the market, Sprint’s first quarter wasn’t pretty. It lost $594 million and a net of 182,000 customers in the quarter.
But across all companies, the total number of wireless subscriptions increased by 4.4 percent from a year ago, according to statistics compiled by Craig Moffett, an analyst at Sanford C. Bernstein. (Leap Wireless, a relatively small player, has yet to report its first-quarter results. So Mr. Moffett’s figures include his estimate for Leap’s results.)
Underneath that total, however, is a great deal of turmoil, as low-priced prepaid plans lure customers from much higher-priced plans, called postpaid, that commit customers to contracts.
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