AT&T Wireless posts strong fourth quarter results

(Telephony) AT&T Wireless' earnings for fourth quarter 2000 jumped 39.1% to nearly $3 billion compared to fourth quarter 1999, as revenues for the year grew to $10.4 billion—a 37% increase—the company announced today.

Much of the credit for the good news was given to the mobility services sector, which saw a significant increase in its subscriber base for both the quarter and fiscal year. Roughly 865,000 consolidated subscribers were added in the quarter and 2.5 million for the year, a 67.5% increase over fiscal 1999.

Overall, the company had 15.2 million consolidated subscribers, a 58.5% increase over the year previous.

Operational EBITDA for the mobility services sector totaled $381 million in the fourth quarter, which helped to offset a $105 million loss incurred by the company’s fixed wireless sector. This loss was attributed to customer acquisition and network costs associated with the large increases in new subscribers.

For fiscal year 2000, operational EBITDA for the mobility sector reached nearly $1.9 billion, an increase of 57.2% over the year previous. Operational EBITDA for the group as a whole totaled $272 in fourth quarter 2000, a 33.3% increase over fourth quarter 1999. For fiscal year 2000 operational EBITDA was $1.6 billion, an increase of 47% over 1999.

"Our first priority was, and remains, growing our core business, by creating more value in our domestic mobile voice network," said John D. Zeglis, group chairman and CEO. "We needed to expand our network and enlarge our footprint so that we can participate in more of the industry’s strong growth.

"And in year 2000 we did just that. We bought strategic markets throughout the year and in the fourth quarter alone we closed our purchases of Houston and Indianapolis, as well as some New England properties. We also built a lot of markets in 2000. By year end, 18 new markets had been turned on to receive roaming traffic and 12 markets—up from the nine originally forecast—had been launched commercially by year’s end."

Zeglis added that the remaining six markets would be launched in the first half of 2001.

Looking ahead, Zeglis indicated that AT&T Wireless Group’s participation in the recent wireless spectrum auction—through its designated entity venture, Alaskan Native Wireless—has positioned the company well in its pursuit of a national UMTS network.

"Our large spectrum portfolio lets us … build all the way to UMTS in 72 of the top 100 markets without more spectrum," he explained. "But in order to create a truly national UMTS network, we needed more spectrum in other markets."

Zeglis got what he wanted. When the bidding concluded, Alaskan Native Wireless had won 44 licenses in 43 markets, at a cost of $2.89 billion. The company now will be able to offer UMTS service in 88 of the top 100 markets, including New York and Los Angeles.

Another goal for AT&T Wireless Group in 2001 is to enhance its ability to deploy wireless applications and mobile content. The company took the first step in that direction today by announcing—along with NTT DoCoMo—an agreement with Sony to explore the delivery of Playstation 2 gaming to the company’s mobile telephones.