AT&T hasn’t been shy about its efforts to cross sell its DirecTV and wireless products. In fact, the carrier has pretty much pegged DirecTV as its vehicle for growth in a video hungry world and has already seen success with its unlimited wireless offer for DirecTV subscribers.
But the carrier’s efforts may soon get another boost courtesy of the launch of Apple’s iPhone 7.
According to Wells Fargo Senior Analyst Jennifer Fritzsche, an increase in AT&T store traffic driven by iPhone 7 sales should help the carrier’s efforts to sell integrated services.
“T continues to guide toward positive video adds (on consolidated basis) for 2016,” Fritzsche wrote in a Friday research note. “Given the losses seen in 1H16, this would imply a significant ramp in 2H (namely in Q4). Helping with this growth should be the traffic in the stores related to the iPhone launch. Recall, T has the largest base of iPhone users. This iPhone refresh store traffic should help with the cross-sell push the AT&T sales reps plan to do.”
Fritzsche also noted AT&T has scheduled the launch of its DirecTV Now over-the-top app for the fourth quarter, which will be offered to subscribers from all wireless carriers. Fritzsche said the forthcoming DirecTV Now offering has the potential to “gain much traction” if the interface – including load time, selection and video quality – is similar to the carrier’s existing DirecTV app. The offering could be particularly popular with AT&T subscribers, thanks to additional incentives from the carrier – such as its announcement that content streamed from the DirecTV app won’t count against AT&T customers’ data caps.
“With video being the main driver of 4G (and expected 5G) traffic, T’s bundled wireless / video offering should see traction if marketed in the correct way,” Fritzsche wrote. “In our view, the steps it has taken to prepare for this Q4 launch will position it well in what is sure to be a competitive Q4 wireless landscape.”
But AT&T isn’t the only carrier that stands to gain from the iPhone 7 launch.
In a separate note, Fritzsche noted reports the iPhone 7 and 7 Plus devices will come with support for multiple carrier aggregation. Should this prove true, she said, Sprint stands to gain the most benefit from the feature thanks to its massive spectrum holdings across the top 100 U.S. Markets. Fritzsche said a software upgrade to allow for multiple carrier aggregation would be “much more capital efficient than an infrastructure capital requirement” to achieve a similar speed boost.
Also looking to cash in on the iPhone refresh is T-Mobile.
The Un-carrier’s Vice President of Investor Relations Nils Paellmann said last month T-Mobile is aiming to grab more market share through the launch. Paellmann said buying a new device like the iPhone 7 gives people a good opening to reevaluate their options and decide whether they want to stay with their current carrier or switch.