AT&T is one of the largest telecom providers in the world. The company has market capitalization of $193 billion with a total of 108 million wireless subscribers. The company operates under two main segments— Wireless and Wireline. Wireless segment generated around 52% of the company’s total revenue during 2012, and has a Compounded Annual Growth Rate (CAGR) of 7.7%. Postpaid Services contributed heavily within Voice and Data communications, generating 90% of total revenues. While Wireline accounted for 48% of total revenues for the company in 2012, it has a CAGR of negative 3% for the same period.
AT&T Company Overview
AT&T is one of the largest wireless and landline telecommunications service providers in the world. The company traces its roots back to 1876 and the invention of the telephone by Alexander Graham Bell.
A holding company, AT&T represents some of the original Regional Bell Operating Companies (RBOC).
The company provides mobile and fixed telephone services along with broadband cable and internet solutions.
The company is looking to expand through strategic acquisitions to increase its spectrum holdings, network capacity and subscribers. AT&T’s long term focus is on organic growth through the introduction of Project Velocity IP (VIP) that will allow it to further expand high-potential growth drivers.
AT&T operates under two main segments: Wireless and Wireline.
Wireless – Generating almost 52% of total revenues in 2012, the Wireless segment leverages AT&T’s nationwide network to provide wireless voice and data communication products for its retail and business customers.
Wireline - Based on traditional landline networks, this segment provides consumers and businesses with voice and data communications services, high-speed broadband (U-verse) and networking solutions. The segment generated almost 47% of AT&T’s overall revenues in 2012.
Wireless segment revenue has been growing at a compound annual growth rate (CAGR) of 7.7% over the last six years and for the first time generated more revenues than the Wireline segment in 2011. Wireline’s CAGR over the same period has been -3.0%
Within each segment, AT&T provides a portfolio of services targeted towards consumers and businesses.
AT&T’s Consumer Solutions accounted for over 70% of the company’s revenues in 2012.
Services under the Consumer Solutions segment include:
Data & Voice Solutions – landline and mobile telephone service
Broadband – wireless and wired residential internet service
U-verse – IPTV (Internet Protocol TV) and internet (data) services
Within the voice and data communications segment, postpaid services have consistently generated over 90% of AT&T’s total revenues. Postpaid customers (subscribers who receive an invoice at the end of a billing term) have higher ARPU (Average Revenue per User) and the least turnover.
The Small Business Services and Enterprise Solutions portfolio offers tailored IP, networking, voice and data solutions, along with management and implementation of these services. Wholesale Solutions are designed to provide services to other telecom service providers and include a similar portfolio of products.
Business Solutions services generated $36.5 billion in revenues in 2012 recording a decline of almost 9% since 2009.