AT&T 4Q13 Earnings Call Notes

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A digest of some of the top insights that I’ve gathered from this week’s earnings calls.  Full notes can be found here.

2013 was a transformative year

” 2013 was an interesting year for the industry and I would suggest you it’s probably a formative year. We saw all competitors take out new positions. We saw most of the players significantly changed the value proposition for their customers. And with smartphone penetration beginning to hit some impressive levels, we have seen new business models emerge around LTE in the cloud and our case that includes things like connected homes, connected cars, video and mobile business solutions.”

US Carriers investing heavily

“So from our view, the most important development that we are seeing is that the entire U.S. telecom industry is investing aggressively in advanced networks. Today in the U.S., four national carriers and dozens of regional providers are building out LTE and you just don’t see that happening anywhere else in the world. ”

Everyone is investing because regulatory environment is just right. Let’s keep it that way

“we think this speaks volumes about where the country’s public policy has landed concerning spectrum and the importance of light touch regulation. We think it’s very, very important to maintain that approach as we move forward.”

Connected cars

“We have a number of new services that we will begin to move the needle this year. We will Digital Life into a number of more markets. We have taken a leadership position and connected cars, we have already announced agreements with GM and Ford, Nissan, Audi, BMW, Tesla and there are more to come.”

Customer phone purchasing behavior shifting. Willing to pay more for phone and lower monthly bill

“what is probably most interesting to me as we look at what has played out in 2013 and carried into the first month of 2014 is the idea that our customers are demonstrating an interest desire even to put more of their money into the handset in exchange for lower monthly pricing. And that’s what you see happening in the marketplace right now. More and more customers are moving to the handset financing plans picking up more of the cost of the handset with the desire to have a lower monthly rate. And so we are seeing that play itself out.”

“all players are introducing these kind of plans and our customers are loving it. You heard John talk about the take rates and now in December, 20% of all of our smartphone sales were on these types of arrangements.”

Net neutrality court decision doesn’t change much about the way they operate

“We did have this court order. From our standpoint David that changed really nothing. It doesn’t change anyway that we will operate, I really don’t believe it’s going to change much of what anybody in the industry will do.”