U.S. Wireless Carriers Competitive Analysis, 2003: A Snapshot of Operating Performance

SUMMARY

Abstract

This IDC study presents a competitive analysis of the major U.S. wireless carriers for the full-year 2002. Standard industry operating metrics (including net subscriber additions, ARPU, churn, CPGA, and CCPU) as reported by the carriers are used as the framework to support IDC's evaluations and assessments of individual carriers and the associated discussion of the state of the wireless industry and the outlook for future growth.

To put all the numbers in context, an overview of key activities, accomplishments, and operating results for the 1Q02-4Q02 period for the major national carriers Verizon Wireless, Cingular Wireless, AT&T Wireless, Sprint PCS, Nextel, and T-Mobile USA are also discussed, in addition to comparisons to operations in 2001. For some key metrics, IDC provides its own estimations of industry averages and various assessments of associated trends and carrier rankings and positioning.

"The wireless industry is in a state of flux. In 2001 and 2002, major carriers have been buying market share at the price of high churn, declining voice ARPU, and higher costs, with the hopes that their respective subscribers will eventually become more valuable as wireless data services are adopted. However, as carriers now seek to acquire new subscribers from a narrowing audience, they will also turn to increasing the lifetime value of their existing customers through customer satisfaction, loyalty and incentive programs, and more targeted marketing." - Dana Thorat, senior research analyst of IDC's Wireless and Mobile Communications program

TABLE OF CONTENTS

Table of Contents

1 IDC Opinion

2 In This Study

• 2.1 Methodology
• 2.2 Wireless Operating Metrics Definitions
• 2.3 Executive Summary

3 Situation Overview

• 3.1 Introduction
  • 3.1.1 Market Overview
    • 3.1.1.1 2002 Summary
      • 3.1.1.1.1 Net Subscriber Additions
      • 3.1.1.1.2 Subscriber Market Share
      • 3.1.1.1.3 Churn
      • 3.1.1.1.4 Average Revenue Per User
      • 3.1.1.1.5 Revenue
      • 3.1.1.1.6 Cost Per Gross Addition (CPGA)
      • 3.1.1.1.7 Cash Costs Per User (CCPU)
• 3.2 Carrier Performance
  • 3.2.1 Verizon Wireless
    • 3.2.1.1 Table: Verizon Wireless Operating Statistics, 2001 and 2002
  • 3.2.2 Cingular Wireless
    • 3.2.2.1 Table: Cingular Wireless Operating Statistics, 2001 and 2002
  • 3.2.3 AT&T Wireless
    • 3.2.3.1 Table: AT&T Wireless Operating Statistics, 2001 and 2002
  • 3.2.4 Sprint PCS
    • 3.2.4.1 Table: Sprint PCS Operating Statistics, 2001 and 2002
  • 3.2.5 Nextel
    • 3.2.5.1 Table: Nextel Operating Statistics, 2001 and 2002
  • 3.2.6 T-Mobile USA
    • 3.2.6.1 Table: T-Mobile USA Operating Statistics, 2001 and 2002
• 3.3 Total Market
  • 3.3.1 Subscribers
    • 3.3.1.1 Subscribers, Net Subscriber Additions, and Market Share
      • 3.3.1.1.1 Table: U.S. Wireless Subscribers by Carrier, 2001 and 2002 (M)
      • 3.3.1.1.2 Table: U.S. Wireless Subscriber Net Additions by Carrier, 2002 (000)
      • 3.3.1.1.3 Figure: U.S. WIRELESS SUBSCRIBER NET ADDITIONS BY CARRIER, 1Q02-4Q02
      • 3.3.1.1.4 Figure: U.S. WIRELESS SUBSCRIBER SHARE BY CARRIER, 2002
    • 3.3.1.2 Churn
      • 3.3.1.2.1 Figure: U.S. WIRELESS CHURN RATES BY CARRIER, 2001 AND 2002
  • 3.3.2 Revenue
    • 3.3.2.1 Average Revenue Per User
      • 3.3.2.1.1 Figure: U.S. WIRELESS ARPU BY CARRIER, 2001 AND 2002
    • 3.3.2.2 Services/Equipment Revenue
      • 3.3.2.2.1 Figure: U.S. WIRELESS SERVICE AND EQUIPMENT REVENUE BY CARRIER, 2002
    • 3.3.3 Carrier Costs
      • 3.3.3.1 Cost Per Gross Addition
        • 3.3.3.1.1 Figure: U.S. WIRELESS CPGA BY CARRIER, 2002
    • 3.3.3.2 Cash Costs Per User
      • 3.3.3.2.1 Figure: U.S. WIRELESS CCPU BY CARRIER, 2002

4 Future Outlook

5 Essential Guidance

6 Learn More

• 6.1 Related Research
• 6.2 Synopsis