It doesn’t matter how long AT&T has had the iPhone; it just keeps selling more. Ma Bell had another record-setting quarter thanks to Apple, activating 8.6 million iPhones and selling a total of 10.2 million smartphones overall in the last three months of 2012.
Of those 8.6 million iPhones, only 16 percent of their owners are new to AT&T, meaning the device is really more a tool for it to keep current customers by upgrading them from other phones or earlier iPhone models. But keeping customers happy with iPhones has benefits as well. AT&T’s contract churn rate (the percentage of its customers that depart every quarter) fell to 1.19 percent from 1.21 percent in last year’s fourth quarter. That puts it just a little bit behind Verizon Wireless, which has the most enviable churn rate in the industry at 0.95 percent.
AT&T added a net total of 780,000 new subscribers, while Verizon added 2.2 million, meaning Verizon grew at a much faster rate. But AT&T and Verizon were evenly matched in smartphone activations. Verizon activated just 400,000 fewer smartphones than AT&T. The difference was primarily in the mix of devices. With only 6.2 million iPhone sales, Verizon leaned much more heavily toward Android devices.
AT&T’s iPhone prowess over the years largely explains its huge smartphone penetration. One in seven contract customers now has a smartphone on the AT&T network.
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