Verizon Wireless customer growth to set tone for Q2

Verizon Wireless added more than 807,000 net new customers during the second quarter, increasing its total customer base to 28 million. Some analysts consider these results more of the norm and expect other carriers to have strong quarter results as well.

“This probably will set the tone for the industry,” said Eugene Signorini, a wireless analyst at Yankee Group. “This quarter will be more of what we consider normal for [carriers.]”

Besides the total customer additions being up slightly over the same quarter last year, Verizon Wireless’ postpaid gross additions increased 10% compared to the second quarter last year and accounted for 85% of total customer additions. Total churn decreased from the first quarter 2001 to 2.3% because of decrease in postpaid churn.

The strong customer adds during the quarter were attributed in part to Verizon Wireless’ launch of its store-within-a-store concept at RadioShack, promotions and its digital prepay product.

The rest of Verizon Wireless’ customer base, about 15%, consists of prepaid customers. Despite the positive customer growth, some analysts on Wall Street have worried about any focus on prepaid, because the value of those subscribers is not fully understood by wireless carriers, Signorini said.

“Carriers need to figure out how they need to attack the prepaid marketplace…there has not been great attention to that market, which produces higher churn,” he said.