Verizon Moving Subscribers, Devices to LTE, CFO Says
Verizon is doubling the amount of smartphone data to drive upgrades, save on costs and better compete, Chief Financial Officer Fran Shammo said during the Wells Fargo investor conference Wednesday. The carrier may be interested in potential divested spectrum from AT&T’s planned buy of T-Mobile, he said.
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Verizon wants to migrate its users from 3G to 4G, Shammo said: “It’s beneficial from a financial standpoint.” Verizon recently doubled the amount of smartphone data to 4 GB for $30 per month. The move reduces the need for capital spending in older technology, Shammo said. The company is also moving its Internet devices to LTE, he said, noting Verizon no longer has 3G Internet devices except for tablets. The company’s LTE sales are going well, Shammo said.
The wireless industry needs more consolidation to create stronger competitors, Shammo said. “The pie isn’t shrinking.” He said there are growth opportunities from new devices and networks. Verizon might be interested in potential divested spectrum from AT&T if the company sells off assets as part of negotiations with federal regulators, he said. Regarding spectrum need, Shammo said Verizon is in good shape through 2015. Additionally, some 3G spectrum can be re-appropriated to 4G, as 3G voice calls start to migrate to 4G in 2012, he said. But Verizon is always on the lookout for additional spectrum, he said. U.S. regulators need to get spectrum to companies that can build the spectrum out, he said.
Meanwhile, Verizon has started to see an uptake in its prepaid market since the start of its $50 monthly unlimited prepaid nationwide plan, Shammo said. Verizon hasn’t seen its postpaid customers moving to prepaid, so “we have found a niche market,” he said. Verizon expects to see improvement in overall wireline margins over time, Shammo said. The company, like many telcos, is still losing access lines, though the decline has slowed down, he said. The company seeks to offer unified products combining wireless and wireline, he said. On enterprise business, the focus is strategic services, Shammo said. Cloud computing will be the enabler of enterprise services, he said.