Verizon leapfrogs AT&T for wireless subscriber lead

Network World - Verizon Communications Inc. has more wireless subscribers than any carrier in the U.S., as its merger with Alltel has helped the company jump ahead of rival AT&T Inc.

Verizon said in its earnings report today that its total number of wireless customers surged to 86.5 million in the first quarter of 2009, when the carrier added a net 14.5 million wireless customers. Roughly 13.2 million of those customers came over to Verizon as a result of its Alltel acquisition, which the Federal Communications Commission approved last November. The big increase in wireless customers now gives Verizon an edge of about 8.3 million wireless subscribers over AT&T, which reported last week that it has 78.2 million wireless customers.

In addition to its large customer gains, Verizon reported a solid net income of $3.2 billion in the first quarter, a 5.3% increase over the $3 billion net income it reported in the first quarter of 2008.

The company's operating revenue totaled $26.6 billion for the quarter, an 11.6% increase from the $23.8 billion in operating revenue it reported in the first quarter a year ago. The company's wireless segment delivered its strongest financial results, with pretax operating income totaling $4.2 billion, an increase of 31.2% from the $3.3 billion pretax operating income it reported in the first quarter of 2008. The only negative aspect of the company's wireless segment was that its churn rate -- or the rate at which its customers cancel their service -- jumped from 1.19% in the first quarter of 2008 to 1.46% in the first quarter of 2009.

The carrier's wireline segment didn't perform nearly as well; its pretax operating income of $691 million represented a steep 33.6% decline from the $1 billion pretax operating income it produced in the first quarter of 2008. But although its wireline business continued to decline in the quarter, the company can take solace in the fact that its total number of broadband connections grew by 7.8% to 8.9 million, while the total number of subscribers to its FiOS Internet (2.8 million) and television (2.2 million) services grew at impressive rates of 55.5% and 83.8%, respectively.