Wireless Industry

2004 saw the communications industry amass revenues of USD1.5 trillion. The shift away from fixed-line to wireless technology is changing the landscape – encouraging new entrants and forcing industry participants to alter the way they think and the services they provide. Consequently the wireless industry is now a vital component of the wider world of communications.

AT&T Wireless Services Inc

In 2001, AT&T Wireless split from AT&T, to become the largest independently-owned and operated wireless company in North America. In February 2004, Cingular Wireless agreed to buy AT&T Wireless Services for about USD41 billion.
Total revenue grew 6.8 percent to USD16,695 million, an increase of USD1,064 million, for the year ending December 31, 2003.

Services revenue for the same year was USD15,659 million, an increase of  8.1 percent year-on-year. The increase in services revenue in 2003 was due to the growth in the subscriber base, including higher roaming, international, and data revenues and an increase in Universal Service Fund (USF) fees and regulatory program fees passed on to the customer base.

Equipment revenue for 2003 was USD1,036 million, a decrease of 9.8 percent from  2002 revenue. This decline was due to a decrease in the average revenue per unit sold.

In the fourth quarter, the company experienced significant difficulty implementing upgraded GSM customer support systems, which had an adverse effect on the number of subscribers and customer care. The results of the company were also affected by the implementation of wireless Local Number Portability (LNP) in the fourth quarter, which resulted in an increase in customer migration to competitors.

Cingular wireless llc

Cingular is a joint venture between the domestic wireless divisions of SBC and BellSouth that began its operations in October 2000. SBC owns 60 percent of the company and BellSouth owns 40 percent, based on the value of the assets   contributed by both to the venture. In February 2004, Cingular Wireless agreed to buy AT&T Wireless Services for USD41 billion. The deal created the biggest cellular phone company in the US telecom industry with 46 million customers.

For the fiscal year 2003, Cingular reported an increase in total operating revenues, service revenues and equipment sales of USD580, or 3.9 percent, to USD15,483. The growth in service revenues was driven by an increased average cellular/PCS customer base, robust growth in data revenues and increased regulatory fee revenues. Strong customer growth and a significant increase in handset upgrade activity in 2003 also contributed to increased equipment sales in the telecom market

These increases were, however, offset by lower roaming revenues. Long distance revenues for 2003 comprised only 1.2 percent of total service revenues and dropped from the previous year primarily because of the inclusion of free long distance minutes in many regional and national tariff plans.

In the fourth quarter 2004, Cingular’s revenues totaled USD7082 million. Pro forma revenues, which incorporate results from AT&T Wireless and other acquired properties for the first 25 days of October and exclude results from divested operations, totaled USD8100 billion, up 1.8 percent from the fourth-quarter revenue of 2003.

ARPU stood at USD49.67, down 5.8 percent from the fourth quarter a year earlier owing to the transition of customers to lower-priced GSM plans and continued popularity of Family Talk.

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