U.S. Mobile Market: Highly Competitive, and the iPhone Still Rocks

Pretty much everything you’ve read about the U.S. mobile industry is true: The networks suck — some more than others — and the iPhone (s aapl) is still a king-maker. Yet according to data collected by Wireless Intelligence, during the quarter ended Dec. 31 2009, 5.9 million net new subscribers signed up for wireless services, the highest number of new adds made during a three-month period in three years.
The battle for subscribers among carriers is best reflected in the recent moves made by Verizon (s VZ) and AT&T (s T). Verizon, which ended December 2009 with 91.2 million subscribers, has launched a slew of smartphones, including the much-hyped Motorola (s mot) Droid. The company also launched a nasty ad campaign to highlight AT&T’s network weakness. The net result: it added 2.2 million net new subscribers during the most recent quarter, the most since the third quarter of 2008. As Jon Groves, analyst with Wireless Intelligence, writes in the report:

In comparison, thanks in part to Apple’s iPhone, AT&T added 2.7 million net new subscribers, taking its total to 85.1 million.Head-to-head after stripping out reseller and wholesale net additions, Verizon reported 1.2 million net additions in 4Q09 against AT&T’s 900,000…However, the iPhone yet again remained a very strong proposition for AT&T, with 3.1 million iPhone account activations reported in the fourth quarter — the second-ever highest quarterly total – of which more than a third were new AT&T subscribers…The remaining operators continue to feel the squeeze outside of the device exclusivity and coverage available from AT&T/Verizon in the contract market and the ‘unlimited’ offerings from the likes of Straight Talk in the prepaid segment.

You can drill down into individual wireless carriers numbers by checking out the GigaOM Q4 Wireless Scorecard.
The growth during the quarter also masked some dangerous trends, however. As Chetan Sharma, a contributing analyst for GigaOM Pro, recently pointed out, during the last three months of 2009, “voice ARPU declined by a substantial 98 cents for U.S. carriers” and “data ARPU increased by a mere 4 percent to 53 cents as overall ARPU decreased 45 cents on the year.”


Related content from GigaOM Pro (sub req’d):

Everybody Hertz: The Looming Spectrum Crisis

Thumbnail image courtesy of Flickr user Rennett Stowe