Chicago (IL) – Recently published cellphone market share numbers in the U.S. indicate that the four largest carriers in the U.S. - AT&T Wireless, Verizon Wireless, Sprint Nextel and T-Mobile - have found effective ways to limit churn and protect their customer base. The growth of the big four is especially painful for smaller carriers that are bleeding market share.   

According to a report published by Gartner, AT&T Wireless, Verizon Wireless, Sprint Nextel and T-Mobile combined are home to 84.4% of U.S. cellphone users, which added up to 272.1 million at the end of Q4 of 2007. If Gartner is correct, then the market is pretty much set with a pattern that indicates that size matters in the current business environment. AT&T Wireless, the largest U.S. cellphone carrier with 70.1 million users, posted the strongest growth in this group, adding 14.9% or more than nine million new customers over the course of the year. Verizon Wireless, second in the group, achieved 11.2% growth (to 65.7 million users), Sprint Nextel with 48.5 million users saw its user base climb 0.7% and T-Mobile 28.7 million customers saw a 14.6% jump.

There are some smaller providers with greater percentage growth (such as Leap Wireless with 28.3% and MetroPCS with 34.7%), but the group of “other carriers” suffers from a decreasing customer base in a market that saw a 9.2% expansion of users in 2007.

Gartner estimates that smaller carriers lost an average of 7.2% of their customers in 2007 that added up to 697,200 users. At the same time, the largest four carriers also posted the highest average revenue per user – between $51.49 for Verizon Wireless and $58.00 for Sprint Nextel (exception: Centennial Wireless users paid 68.00 per month on average) as well as the lowest churn rate, which indicates users a carrier lost: While providers such as Boost Mobile posted a churn rate of up to 7.5%, Verizon Wireless stood at 1.20%, AT&T Wireless at 1.7%, Sprint Nextel at 2.30% and T-Mobile at 2.80%.

Smaller carriers need faster expansion

May 20, 2008 13:16     

I have been on the same AT&T unlimited plan for almost six years even after Cingular bought them and now changed the same back to AT&T. I thought Cingular was going to kick me off of my plan so I looked into Cricket and Metro PCS two years ago and today their coverage map looks pretty much the same. I fly to different areas sometimes so I need good coverage. Those small companies don't seem to stand a chance. Especially since they didn't buy any new spectrum at the FCC auction I would like to see more competition especially with data. It's way too expensive. I wish Sprint would launch Xohm WiMax service and stop delaying it.

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durr - For good reason

May 20, 2008 15:14     

And the reason for this is VERY VERY simple. A.) Coverage is better with a bigger company and more towers. B.) Mobile to mobile is free. Who needs anything more than a base plan when you, your family and all your friends all have the same carrier and you can talk to them for "free" (no minutes used). Most people jump on the same network as the people they know. I don't know a single person around me that isn't on ATT and it isn't because of their "great customer service" or "affordable plans", it's simply because we all have it so it requires no minutes and we can all stay on the $39.99 plan and afford the not so impressive text message packages. Mobile to mobile is the only thing that keeps these ridiculous plan prices alive (and to a smaller extent the laughable "circle/myfaves" crap.

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Sprint

May 20, 2008 19:21     

Sprint overcharged our small company over $50,000.00. We caught them and asked for the over-payments to be refunded. they have refused. Read the full story on http://www.sprint-really-sucks.com
AllenHarkleroad report abuse vote down vote up Votes: +3

Need to stand out

May 21, 2008 11:41     

If the smaller carriers want to compete with the 'big boys', they need to have something worth switching to a smaller service provider.
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coverage shmoverage

May 26, 2008 15:26     

People keep talking about smaller carriers not having good coverage, but I have had the opposite experience. I have been a happy alltel customer for 6 years. Alltel does have its own network, but we also use both sprint's and verizon's networks, and I don't have to pay any extra for roaming on their networks. That means I have service anywhere that Sprint or Verizon users do. I have never (not a single time) been in a situation when any user of any other network had coverage and I did not. Just my $.02...

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