AT&T CFO Rick Linder said at a conference today that the company is expanding its smartphone portfolio ahead of the eventual end of its exclusive hold on the iPhone.
The company is looking at devices based on Android, Windows Mobile and BlackBerry to diversify its handset lineup, Linder said during a discussion at the UBS Global Media and Communications Conference.
“At some point, as it does with all exclusive arrangements, the exclusivity arrangement ends,” Linder said of AT&T’s deal with Apple for the iPhone. “It’s important to support all the major operating systems, particularly those devices on the higher end that tend to be more data intensive.”
Linder said the fact that AT&T had an “absolutely blowout quarter” for the iPhone in the third quarter despite rumors that the carrier was about to lose its exclusivity arrangement on the device was a “positive vote of confidence” from customers.
AT&T’s efforts to improve consumer opinion of its wireless network took a hit this week when Consumer Reports reported that its readers using AT&T’s service are the least satisfied with their service.
AT&T is working to upgrade its 3G network to HSPA 7.2 and HSPA+ and is also preparing to deploy LTE next year. The company is building Ethernet-based backhaul across its footprint to support its LTE launch, Linder said.
Linder defended AT&T’s decision to wait until next year to deploy LTE. He said that by waiting to launch next-generation services, AT&T will be able to provide its customers with a greater selection of devices and will be able to avoid the possible technical pitfalls of deploying before all the kinks in the new technology are worked out.
Linder also discussed AT&T’s move toward usage-based pricing. He admitted that customers in focus groups initially balked at the idea of usage-based pricing because they were worried about getting hit with a big bill, but said the company’s transparency about data usage has ameliorated those fears.
“Going to usage-based pricing was one of the more difficult decisions we made,” Linder said, admitting that customers in focus groups told the operator they’d rather have unlimited pricing. “The problem is that long-term, in an environment in wireless where traffic growth is exploding and where spectrum and the technology itself is limited, it’s not a sustainable model. You’ve got to move toward more of a usage-based pricing scheme.”
Linder said AT&T’s $15 200MB data plans have been a good entry point for customers who previously didn’t have a data plan and that the “majority who moved to usage-based pricing” are on the company’s $25 2GB plan.