October 19, 2006, 3:54 PM — Mobile data services helped drive up average customer spending for Cingular Wireless LLC in the third quarter, the largest U.S. cellular operator said Thursday.
Monthly spending by the average customer was US$49.76, up from $49.65 during last year's third quarter. It was the first time their spending had risen year over year since the company acquired AT&T Wireless in October 2004, according to company spokesman Mark Siegel.
Data services were a major factor in the gain, he said. Average spending on data services rose to $6.32, up 46 percent from a year earlier and 10 percent from the second quarter. Ringtones, downloadable games, instant messaging, e-mail and photo messaging are increasingly popular, as are bundles of various data services, according to Cingular.
The carrier had 28 million active data customers in the third quarter, out of a total of 58.7 million subscribers, the nation's largest customer base, the company said. Its total subscribers grew by 6.4 million from a year earlier.
As prices for voice calls have fallen, Cingular and other mobile operators have invested in expensive high-speed networks and looked to data services to boost revenue and profits. Customer adoption had been slow in the U.S. but is now picking up for some services.
Total revenue for the quarter was $9.6 billion, up 9.2 percent from a year earlier. Net income was $847 million, compared with $222 million a year earlier. Siegel attributed the boost in profit to lower costs resulting from the merger with AT&T Wireless. The company completed the integration of the two networks during the quarter.
Cingular is a joint venture of AT&T Inc. and BellSouth Corp. AT&T's acquisition of BellSouth is expected to close following approval by the U.S. Federal Communications Commission.