Wells Fargo last week held its annual Technology, Media & Telecom Conference featuring a star-studded lineup of telecom industry execs.
Leaders from all four major U.S. wireless carriers took part, sharing tidbits of interesting information about everything from network plans to capex to subscriber additions. Here are some of the standout comments:
After losing 36,000 postpaid net additions in the third quarter, Verizon Executive Vice President and President of Operations John Stratton said the carrier is expecting to return to positive net additions in the fourth quarter. While it will strategically pursue holiday promotions, Stratton noted the carrier’s focus remains on protecting its high-quality base, keeping churn in check, and increasing the number of connections per account. Stratton said Verizon is also still working to lower SG&A costs by moving to digital customer service through its smartphone app.
Stratton also highlighted the uptake of Verizon’s refreshed plans, noting the carrier has “had literally tens of millions of our subscriber lines shift onto these plans in just the first couple of months in the market.”
Stratton said Verizon now has “roughly 30 million active users of our Web and digital properties amongst our base every single month,” which he attributed in part to a surge following the launch of its new data plans this summer.
AT&T CFO John Stephens tackled head on the question of how the election will impact its Time Warner merger by noting he believes President-elect Donald Trump’s focus on innovation is in line with what the carrier is trying to achieve.
“We really look forward to working with President-elect Trump and his transition team,” Stephens said. “Policies and discussions about infrastructure investment, economic development and American innovation all fit right in with AT&T’s goals.”
Stephens also said AT&T’s Adworks platform is also growing by double digits and offers an opportunity for the company to offer targeted and unique services to consumers and businesses by utilizing the data it collects.
Sprint CFO Tarek Robbiati said 67 percent of its base is already on unsubsidized plans and noted the carrier is looking to bump that figure to 90 percent. As that happens, Robbiati said service revenue will stabilize and hit an inflection point; this transition is expected to happen within several quarters rather than years, he said.
Robbiati said investors can also expect Sprint to move a second tranche of spectrum within the next six months to a year. Interest in the initial $3.5 billion offering was 10 times oversubscribed, he said.
Like Verizon, Robbiati said Sprint also feels good about its fourth quarter figures, and noted the carrier’s porting trends remained stable in November, leaving it net port positive over other carriers.
CFO Braxton Carter and CTO Nevill Ray took the stage together and told investors it’s possible a new leader in the White House could make mergers and acquisitions a bit easier going forward. Of course, they said, it all depends on who takes the leadership roles at the Department of Justice and FCC with Trump’s administration.
Carter said capex spending is expected to be relatively flat in the coming years despite massive subscriber growth thanks in part to efficiencies gained by pushing traffic to Voice-over-LTE (VoLTE). Ray said T-Mobile currently carriers 60 percent of its calls over VoLTE.
“We don’t see any significant increase in capex on the horizon,” Carter said. “Sure, it went up a little bit this year from last year, but you’re talking a few hundred million dollars on a year to year-to-year basis as we continue to scale the network.”
Ray said the carrier will strategically use small cells in hotspot markets where necessary, and already has contracted to bring 7,000 small cells online this year.
In the fourth quarter, Carter said T-Mobile will be “prudent” with its promotions to save some oomph for an aggressive first quarter.
“The benefit of putting that growth at the beginning of the year is you pay for that growth from a cash standpoint in year because you have the margin growth coming off those customers,” Carter said.