Customers who always wanted the newest phones would benefit from wireless carriers' competition. AT&T recently announced a plan that would let its customers to frequently upgrade their devices.
Previously, the wireless carrier's customers needed to stick with a phone or tablet for two years. After two years, AT&T would allow them to trade for a new and discounted device. With the new plan, AT&T said that its clients could already trade their devices each year. Also, AT&T would not ask for an upfront fee like T-Mobile.
AT&T's strategy was announced after T-Mobile started offering the same plans. According to a Wells Fargo analyst, Jennifer Fritzsche, the kind of strategy worked well for T-Mobile. She believed that AT&T would benefit with it too.
This month, AT&T reported that it gained 551,000 monthly contract customers during the quarter. Its profits climbed by 1.6% to US$32.1 billion. AT&T's total wireless income, together with equipment sales, rose by 5.7%. However, its operating income decreased to US$6.1 billion compared with US$6.8 billion a year earlier. Its operating margins plunged to 19.1% compared with 21.6% in 2012.
Join the Conversation