Senior Executive VP Andy Geisse will handle the business sales efforts previously overseen by Stankey, as well as the consumer businesses headed by Ralph de la Vega. De la Vega remains in charge of the company’s wireless business.

Technology chief John Donovan was named senior executive VP of technology and network operations. All four report to CEO Randall Stephenson.

Meanwhile, corporate strategy head Forrest Miller is retiring after three decades with the company.

The moves follow AT&T’s failed bid to acquire T-Mobile USA.

Over the long-term, the company is aiming for an average of five devices per subscriber.

“We think customers are going to have five devices,” said Colson Hillier, Verizon’s executive director of data applications.

Today, customers often have multiple connected devices, including laptops, televisions and tablets. Even when they are connected, most of those devices are linked to the Internet via Wi-Fi. Over time, though, Hillier said that Verizon sees an opportunity to add 4G.

One of the obvious impediments is today that would require either the use of a hotspot or signing up for multiple rate plans. Verizon, like other U.S. carriers, is looking at offering data plans that allow customers to share a pool of gigabytes among a number of different devices.

“You don’t get there with five plans,” he said.

Verizon’s chief executive said last month that some sort of shared data plan should arrive some time in 2012.

AT&T has also said it wants to offer such plans, but mobility chief Ralph de la Vega said in an interview this week that ironing out the details is taking longer than he had hoped.

Hillier also said that Verizon plans to offer home broadband service using its 4G LTE network in the first half of this year.

“We think it fits very well (for) rural markets and customers that are under-serviced,” Hillier said.

(Image credit: iStockphoto | thesuperph)

MORE CES NEWS:

• Complete coverage
• HP’s Former CTO: Ultrabooks Are Nothing New, webOS Still Has Life Yet
• Walt Shows Off CES Gadgets for Fox Business News (Video)
• What Kind of Web Video Plans Does Sony Have? (Video)
• Fujitsu Seeking Way Into Crowded U.S. Smartphone Market
• Why Rhapsody Is (Probably) Bigger Than Spotify — In the U.S.
• Microsoft Beefing Up CeBit Presence Even as It Pulls Back on CES
• Inside the CES Lost & Found
• FCC Chairman Has New Tablet, but Same Script: More Spectrum!
• Verizon Wireless: We Want to Connect Five Devices for Every Subscriber
• Ultrabooks From HP and Lenovo That Are (Kinda, Sorta) Different
• Walt and Katie Take a Tour of CES (Video)
• Schmidt-Storm Alert: The Google Chairman Didn’t Like Your Question
• T-Mobile Expands Bobsled Messaging Service
• Intel Shows Just How It Plans to Get Into Phones (Video)
• Motorola CEO: We’re Going to Release Fewer Phones This Year
• Kinect Helps Keep Aging Xbox at the Top of Its Game
• More From T-Mobile CEO: On Pricing, LTE and That Ever-Elusive iPhone
• Exclusive: New Boss Acknowledges Windows Phone Still Has “Awareness Problem”
• And You Thought Jawbone UP Was Going to Miss the CES Party!
• Interview: T-Mobile CEO Says No Second AT&T Deal Out There
• Grover Is at CES and I Am Missing It
• BlueStacks Bringing Android Apps to Windows 8
• Why the Future of TV Won’t Be Here Soon
• Nvidia’s Tegra 3 Tries to Save Battery in All Sorts of Different Ways
• Dynamic Dual Coverage: Ballmer’s Last Act in Vegas and the BCS Championship in 3-D
• Microsoft Phoning In Its Last CES Keynote
• Myspace — Yes, Myspace — Says It’s Going to Sell You Web TV
• Samsung Unveils “Super” 55-Inch OLED TV
• Nokia Unveils That LTE Windows Phone It’s Been Dying to Share
• Steve Ballmer Gives Ralph De La Vega a Very … Vigorous Greeting (Video)
• Interview: AT&T’s De La Vega on LTE, Tablets and Life After T-Mobile
• AT&T’s De La Vega: Shared Data Plans Still in the Works
• LG: 55-Inch Glasses-Free 3-D Screen Is on the Way
• LG Pushes 4G Smartphone Through Verizon: The LG Spectrum
• Live: AT&T’s Vegas Act Stars LTE and, Making Her Return to the Stage, Nokia
• CES Notebook: The Constant Search for Power and Vegas’ Worst-kept Secret
• Belkin Bringing Mobile TV to Lots of Cellphones, Will Anyone Tune In?
• Acer Introduces “World’s Thinnest” Ultrabook and a “Me-Too” Cloud Service
• There Better Be Some Cool Stuff at CES, Because CE Holiday Sales Data Bytes!
• CES 2012: Snooki and Bieber Are In, Gaga Is Out!
• Coming to a Smartphone Near You: Gorilla Glass 2
• RIM Hopes Next PlayBook OS Will Impress at CES
• Ultrabooks, the Ultra-Fancy New Name for Laptops
• At CES, Expect More Gadgets Telling You to Get Off the Couch
• Intel to Detail Its Phone Plans at CES Next Month
• Microsoft Pulling Out of CES After Upcoming Show
• Intel to Detail Its Phone Plans at CES Next Month
• Dell Will Drop the Flashy Vegas Act for CES This Year
• Ultrabook Conga Line Preps for CES 2012

The same folks who were on stage at AT&T’s event this morning — Nokia CEO Stephen Elop, Microsoft CEO Steve Ballmer and AT&T Mobility chief Ralph de la Vega — are all expected here, and one would presume they will have devices in hand.

As a reminder, Nokia has already announced its first Windows Phone for the U.S. — the Lumia 710 for T-Mobile. That phone, due this month, is an entry-level product that will sell for $50 with a new contract.

We’ll have live coverage, wireless permitting, once the event starts around 3 pm PT.

Earlier:

2:53 pm: OK, we’re here, charged up and logged in. Fingers crossed that Wi-Fi behaves for the event, which should run for about an hour.

3:02 pm: Elop takes the stage. “It’s wonderful to be here in North America on behalf of Nokia,” says Elop, the Canadian former Microsoft executive.

3:04 pm: Elop very briefly mentions the company’s entry-level phones for emerging markets, before turning to the company’s Windows Phone-based smartphone strategy.

Elop uses his favorite lines, talking about how a battle of devices is now a war of ecosystems and once again refers to the Lumia 710 and Lumia 800 as the first real Windows Phones.

3:06 pm: Elop talking up Lumia 710, which goes on sale this week (Jan. 11) on T-Mobile.

More war talk: Nokia is establishing beachheads, country by country …

Nokia Lumia 900 for AT&T introduced with a video. Elop holding it up, talking about AT&T’s exclusive.

Initially available in black and cyan (that’s blue to you and me).

Primary camera has Zeiss optics and wide aperture for low light along with a front-facing camera for video chat.

It looks like the Lumia 800, only bigger with its 4.3-inch screen.

3:10 pm: Nokia senior VP Kevin Shields comes up to show off a few of the device’s features.

The device is made from injection-molded polycarbonate, like the N9 and Lumia 800, which it looks an awful lot like.

3:17 pm: Shields touts the phone’s front and rear cameras, Nokia Drive (built-in turn-by-turn directions) and some custom apps such as the ESPN Windows Phone app that is exclusive to Nokia.

Other partners include Univision, the Atlantic Coast Conference and Sesame Street (of which I am a huge fan).

3:21 pm: Ballmer now on stage talking about Microsoft’s partnership with Nokia. He notes that Nokia has delivered the first Windows Phones in well under a year.

3:23 pm: Ballmer underscored, as he has repeatedly of late, that Microsoft has “room to grow” in terms of selling Windows Phones.

3:24 pm: Now out is the third in the executive triumvirate, AT&T Mobility chief Ralph de la Vega. “We’ve been spending a lot of time together,” de la Vega said, noting their appearance together at AT&T’s event this morning.

“Nokia is going to be back in the U.S. in a very big way,” de la Vega said, adding the Lumia 900 will be out “in the coming months.”

“We’re big fans of Windows Phone,” he said.

3:26 pm: Elop isn’t any clearer about Nokia 900 timing, saying only that the device will ship “in the months immediately ahead.”

Time for Q and A.

3:28 pm: What about Verizon? “Today we are just announcing AT&T” but clearly the company wants to get in front of as many U.S. consumers as possible.

3:30 pm: Asked about potential for fragmentation in the Windows Phone market, Elop says he is glad that Nokia isn’t alone in making Windows Phones. “I’m so happy companies like Samsung and HTC are releasing” Windows Phones. “We all need that to get the ecosystem going.”

That said, he added that “we do need some elements of differentiation.” The company is focused on specific apps and other things that won’t break compatibility within Windows Phone.

3:32 pm: Asked about pricing and specifics on availability, Elop again declines to give a more detailed time frame and, on pricing, he says only that it will be “aggressive.”

3:33 pm: As for where Nokia is headed, Elop indicated the company sees room for Windows Phone devices that cost less than the 710.

3:35 pm: In addition to its other app partnerships, Nokia said on Monday that it is working with games leader Electronic Arts to bring more than 20 new games to Windows Phone “coming first to Nokia Lumia devices.”

3:38 pm: Asked about what it would take for Nokia to get into tablets, Elop said it would want room to stand out.

3:40 pm: Why no NFC?

Elop notes that Nokia has been a pioneer in near field communications and already ships it on some Symbian phones.

As for why it is not on the first Windows Phones, Elop said the company had to prioritize and it wasn’t the most critical thing for consumers at this point.

“NFC is growing in importance. It’s something I personally believe in.”

Asked for an update on reports that Nokia looked at some sort of deal for RIM, he said, “There’s never been any information at all so there is no update available.” That said, he indicated Nokia does see an opportunity to make inroads in the business market RIM has dominated.

And with that, the press conference ends.

Here’s the scene from today’s AT&T presentation at the Consumer Electronics Show, when mobile chief Ralph de la Vega brought Ballmer up on stage. Via the smart guys at Geekwire:

But wait! I can hear you saying: Did Ballmer conclude his chat with his world-famous “developers!” shoutout?

Ina Fried has your answer:

MORE CES NEWS:

• Complete coverage
• HP’s Former CTO: Ultrabooks Are Nothing New, webOS Still Has Life Yet
• Walt Shows Off CES Gadgets for Fox Business News (Video)
• What Kind of Web Video Plans Does Sony Have? (Video)
• Fujitsu Seeking Way Into Crowded U.S. Smartphone Market
• Why Rhapsody Is (Probably) Bigger Than Spotify — In the U.S.
• Microsoft Beefing Up CeBit Presence Even as It Pulls Back on CES
• Inside the CES Lost & Found
• FCC Chairman Has New Tablet, but Same Script: More Spectrum!
• Verizon Wireless: We Want to Connect Five Devices for Every Subscriber
• Ultrabooks From HP and Lenovo That Are (Kinda, Sorta) Different
• Walt and Katie Take a Tour of CES (Video)
• Schmidt-Storm Alert: The Google Chairman Didn’t Like Your Question
• T-Mobile Expands Bobsled Messaging Service
• Intel Shows Just How It Plans to Get Into Phones (Video)
• Motorola CEO: We’re Going to Release Fewer Phones This Year
• Kinect Helps Keep Aging Xbox at the Top of Its Game
• More From T-Mobile CEO: On Pricing, LTE and That Ever-Elusive iPhone
• Exclusive: New Boss Acknowledges Windows Phone Still Has “Awareness Problem”
• And You Thought Jawbone UP Was Going to Miss the CES Party!
• Interview: T-Mobile CEO Says No Second AT&T Deal Out There
• Grover Is at CES and I Am Missing It
• BlueStacks Bringing Android Apps to Windows 8
• Why the Future of TV Won’t Be Here Soon
• Nvidia’s Tegra 3 Tries to Save Battery in All Sorts of Different Ways
• Dynamic Dual Coverage: Ballmer’s Last Act in Vegas and the BCS Championship in 3-D
• Microsoft Phoning In Its Last CES Keynote
• Myspace — Yes, Myspace — Says It’s Going to Sell You Web TV
• Samsung Unveils “Super” 55-Inch OLED TV
• Nokia Unveils That LTE Windows Phone It’s Been Dying to Share
• Steve Ballmer Gives Ralph De La Vega a Very … Vigorous Greeting (Video)
• Interview: AT&T’s De La Vega on LTE, Tablets and Life After T-Mobile
• AT&T’s De La Vega: Shared Data Plans Still in the Works
• LG: 55-Inch Glasses-Free 3-D Screen Is on the Way
• LG Pushes 4G Smartphone Through Verizon: The LG Spectrum
• Live: AT&T’s Vegas Act Stars LTE and, Making Her Return to the Stage, Nokia
• CES Notebook: The Constant Search for Power and Vegas’ Worst-kept Secret
• Belkin Bringing Mobile TV to Lots of Cellphones, Will Anyone Tune In?
• Acer Introduces “World’s Thinnest” Ultrabook and a “Me-Too” Cloud Service
• There Better Be Some Cool Stuff at CES, Because CE Holiday Sales Data Bytes!
• CES 2012: Snooki and Bieber Are In, Gaga Is Out!
• Coming to a Smartphone Near You: Gorilla Glass 2
• RIM Hopes Next PlayBook OS Will Impress at CES
• Ultrabooks, the Ultra-Fancy New Name for Laptops
• At CES, Expect More Gadgets Telling You to Get Off the Couch
• Intel to Detail Its Phone Plans at CES Next Month
• Microsoft Pulling Out of CES After Upcoming Show
• Intel to Detail Its Phone Plans at CES Next Month
• Dell Will Drop the Flashy Vegas Act for CES This Year
• Ultrabook Conga Line Preps for CES 2012

The company kicked off 2012 by announcing six new Android devices, all running on LTE, as well as new LTE-capable Windows phones from HTC and Nokia.

Moments after he left the stage, AT&T Mobility CEO Ralph de la Vega sat down with AllThingsD to talk about a wide range of issues facing his company, various mobile device makers and the industry as a whole.

Here’s an edited look at what he had to say.

On the failure of the T-Mobile deal and where AT&T goes from here:

We’re very pleased that the FCC approved our purchase of the Qualcomm spectrum. We’ll be working to put that into play as quickly as possible. And we are always going to be on the lookout for new spectrum that comes on the market. We hope that the FCC also makes more spectrum available.

We’ve put that behind us and we are moving on to have a great 2012.

On BlackBerry maker Research In Motion, which was notably missing from AT&T’s announcement on Monday:

BlackBerry has got some interesting things coming up. I’m encouraged by some of the things that I understand they are bringing to market.

BlackBerry has been a great partner and, you know, people love their devices. They love the keyboards. I think they are working on all of the things customers want. I am very pleased with, at least, the things that are on their roadmap. As soon as they can get them I think they are going to have a lot of customers knocking on their door.

On Motorola, which was also absent from AT&T’s Vegas announcements:

They are going to have some exciting stuff. They are just not ready to announce them with us. It’s really early in the year.

On Sony’s future in the smartphone market:

As you know, they bought out the Ericsson interest. I think they are going to have a more focused approach and put what I call more “Sony-ness” into their smartphones. We’ve met with their team and I am very encouraged.

On whether AT&T will offer fewer tablets this year after so many iPad rivals failed to make a dent in the market:

I think you are going to see us find models that have a particular differentiated approach to the tablet market. Obviously Apple sets the bar with the iPad, so Pantech is now looking at a very low-end device, still a great device, but I think that kind of distinction is what customers want.

On why the 5.3-inch Samsung Galaxy Note might stand a chance:

That’s the first hybrid device that tries to fill in a niche between a tablet and a smartphone. I’ve been using that device and it is, surprisingly, an amazing device. I didn’t understand whether we were going to be able to make that transition work, but you ought to try it. I think you will get hooked on it.

I think it is for somebody that wants to make it their primary device and doesn’t want to carry around a tablet as well. It’s surprisingly thin. It fits in your pocket.

That’s an iconic device. It’s exclusive to us. We’re going to put a lot of marketing effort behind it.

On whether we will see LTE phones that work across multiple carriers even though the first devices don’t support that.

The first ones are done that way because of technology limitations. How many antennas can you squeeze into one of those things? It’s the first generation. As the technology matures, you will incorporate more bands into the devices. I think you will have as many bands as customers are going to want. It’s not inexpensive, but I think technology will allow us to do that at a reasonable price.

“We’re still working on that,” AT&T CEO Ralph de la Vega said in an interview on Monday, just after wrapping up his keynote speech at AT&T’s developer conference in Las Vegas. “It just takes a little more time than we all would want it to take. But sometimes it’s better to make sure you take your time and get it right.”

Verizon has said it expects to see such plans arrive this year and de la Vega himself said at last year’s D9 conference that AT&T was also looking to let customers pool their data into a single plan.

“We’re working on one,” he said at the time. “It will be soon. I can’t comment on a quarter (when it will launch) but it will be soon.”

France Telecom already offers such plans in some of its European markets.

The need for such plans was further highlighted on Monday by one of AT&T’s announcements. The company plans to sell a bundle with Pantech’s LTE phone and tablet for just $249. It is a good deal, of course, but the annoying catch is that it requires signing up for two separate data plans.

De la Vega talked about a number of other topics during our chat, including why he thinks Samsung’s 5-inch Galaxy Note phone/tablet hybrid stands a chance and why Motorola and Research In Motion were entirely absent from Monday’s talk.

I’ll have more from our interview in a bit.

During AT&T’s third-quarter conference call this morning, mobile chief Ralph de la Vega said that despite a dip in the number of Apple iPhones activated in the latest quarter, the holiday season is shaping up to be one of the company’s strongest smartphone quarters ever.

Here’s what is driving the fourth quarter: For the first time, AT&T is offering an iPhone — the 3GS — for free with a two-year contract; the iPhone 4S is turning out to be the strongest launch ever, with more than one million activated as of Tuesday; it is also launching its first LTE devices; and generally strong holiday sales are expected.

AT&T is late in rolling out its 4G network on the LTE standard, compared to its next-closest competitor, Verizon Wireless, which blankets many of the major cities in the U.S. So even though the devices will be available, the network will be spotty.

“I’ve been a part of many network and device transformations, and this technology is the best I’ve ever seen. The devices are fast and thin and have great battery life,” de la Vega said. “What I see happening with LTE and data is a huge growth opportunity. We mentioned that 52 percent of our post-paid base … In the future, you could look at 100 percent penetration, not two-thirds of our sales, like we are seeing today.”

AT&T said that by the end of the year it will cover 15 cities, representing 70 million people. The next two markets to be built out will be Boston and Washington, D.C. The company previously said it had launched in Atlanta, Chicago, Dallas, Houston and San Antonio.

To date, the wireless carrier had only been selling data devices for the network, such as a data stick and a mobile hotspot.

On the bright side, the company added 2.1 million wireless subscribers, which sent its total base past the 100 million mark. Total churn — the rate of customers who cancel service — was 1.28 percent, down from a year-ago level of 1.32 percent.

During the call, CEO Ralph de la Vega and CFO John Stevens sounded bullish notes on the smartphone business. For example: Smartphone users now account for more than half of AT&T’s subscriber base, and will, as de la Vega put it, eventually reach 100 percent. My notes from the conference call are below.

Earlier:
6:56 am: Good morning from New York. I’m tuned in to AT&T’s Webcast and waiting for the conference call to get under way. Right now I’m hearing the soothing tones of a peppy New Age guitarist. Or actually what sounds like a pair of them.

7:03 am: And we’re getting under way.

John Stevens, CFO: Comments on T-Mobile: FCC review is continuing. DOJ case is continuing. Our expectations continue to be that we will reach a successful conclusion.

Now on to the business at hand: Sales were strong across the board, with gains in every category. Smartphone sales were robust in a quarter where you would expect sales to be slow. Impressive service margin results. In addition to solid earnings, we delivered excellent free cash flow. Strongest cash flow in two years, even with significant Capex spending.

Consolidated revenues: Strengths were offset by declines in voice and directory. Last year’s iPhone launch during the quarter made for a difficult compare this year.

7:09 am: Year to date, 75 percent of services come from wireless and wireline data and services.

7:10 am: Now CEO Ralph de la Vega is taking over.

De la Vega: 4.8 million smartphones sold this quarter and 16 million-plus so far. Strong sales of data-only branded computing devices, our best quarter ever.

De la Vega: Our enhanced backhaul network is delivering incredible speeds. Also launched LTE. Fifteen cities will get it. Boston is among those about to be turned on. Missed the other city, sorry.

First LTE handsets are coming this quarter. And the other city getting LTE is Washington, D.C.

De la Vega: We expect the fourth quarter to be the best for smartphone sales ever.

De la Vega: Subscribers north of 100 million for the first time. Postpaid net adds 319,000. Another 473,000 added through resellers.

De la Vega: Total churn improved year over year and sequentially. It seems like a long time ago when performance with the iPhone was top of mind. He says a lot of iPhone users are choosing to stay with AT&T rather than move to competing carriers like Verizon and now Sprint.

7:16 am: Now that we offer a free iPhone with a two-year contract, we expect to broaden the iPhone base.

7:17 am: Smartphone subscribers now make up more than half of post-paid customers. He says that’s an important milestone.

De la Vega: Wireless margins expanded. Best margin performance in six quarters, and this comes amid a strong sales quarter. Our service margins this quarter were better, and we sold almost a million more smartphones than we did a quarter ago. He’s comparing last year’s second quarter, which was ahead of another iPhone launch, to this quarter.

7:19 am: CFO John Stevens is back to talk about wireline business.

Consumer and U-verse: Stevens is bragging about J.D. Power and Associates giving them an award for best video experience. IP Data now represents an annual revenue stream of $11 billion, growing 19 percent year over year. 176,000 subscribers added during the quarter. Offset by an equipment upgrade and storms in some areas.

ARPU on customers is $176, up 6 percent year over year.

Wireline business subscribers: First sequential growth in three years. What makes this more impressive is that it’s occurring amid a weak economy, slow employment and the transition to IP-based products.

Stevens: Now he’s talking about margins and cash flow. Consolidated operating margin 19.8 percent. After adjusting for Alltel and the storms, the margins would have been higher than that.

7:26 am: Free cash flow: Cash flow from operating activities was $27.2 billion in the first nine months of the year. Capex was $14.7 billion. There’s more than $10 billion in cash on the balance sheet. Net debt-to-EBITDA ratio is 1.41.

Now Stevens is recapping the results, and then I guess we’ll get into the Q&A with analysts.

7:29 am: Question from Morgan Stanley: Can you talk about the LTE rollout? How should we think about LTE over the next few quarters, driving ARPU and revenue and efficiency gains?

De la Vega: I have been a part of many network device transformations. This technology is the best I’ve ever seen. The devices are great and thin and have great battery life. It’s a home run right off the bat. I think we’ve timed it perfectly. What I see happening with LTE and data is just a huge growth opportunity. Smartphones are now 52 percent of post-paid base. The smartphone is going to equal the phone. It will be 100 percent in a few years.

De la Vega: And then you add on top of that tablets and Mi-Fis and e-readers and telematics. The growth opportunity goes off the charts. Add the cloud on top of that, great data and connectivity. Huge growth opportunities all around.

De la Vega: We’re doing it with a technology, LTE, that reduces the cost per megabyte, and is more spectrum efficient. I’m very bullish on what we’re seeing on data.

De la Vega: While there are several puts and takes on ARPU, it was slower smartphone growth. Third quarter was slower than normal because we didn’t have an iPhone refresh. So we expect the best smartphone quarter ever, and ARPU will improve along with that.

Question from Sanford Bernstein: Given the decline in interest rates, what do you expect in terms of cash contributions to the pension?

Stevens is answering. We’ll make those decisions at the end of the year, and make determinations on funding at that time. That said, we commonly follow and review that process. We have functions for pension funding and think we can handle those within the normal course of cash flows. They’re also tax deductible. Tax planning. Zzzzz …

7:37 am: Question from J.P. Morgan: Wireline business. How should we think about margins going forward, and what to expect from the consumer business?

Stevens: On a full-year basis, we’re in the range of 10-20 basis points, lagging on an operating income basis for wireline. Hope to make it up in Q4. Hope to maintain margins at this level. It’s a challenging endeavor, especially from high-margin legacy products. With regard to DSL, the most encouraging piece of the DSL story — while net adds were in the 5,000 range — was that we were able to convert a huge piece of DSL to U-verse, where available. And for those who don’t have U-verse available, there will be LTE, which they say will be available to 97 percent of the country.

Question from Citi Investment Research: Another question about margins. Slower device sales, related to the iPhone. Can you talk about having mid-40s margin as people move more typically to smartphones?

Stevens: Margins for the quarter included almost five million smartphone sales. When you compare it to prior quarter before an iPhone launch, our margins were 60 basis points higher, and we had a million more smartphones.

7:43 am: Question from Nomura Securities: More detail on expectations of the 2 percent ARPU growth in the fourth quarter?

De la Vega: What we typically see is customers on feature phones step up to the smartphone category. We expect that to happen in greater numbers in the fourth quarter. That is going to dramatically change. Another device will move a lot of people to smartphones — the free iPhone 3GS. We’re getting more new subs on average with that than the other devices. We’re sold out on that device right now. We feel very confident. Impact from Alltel acquisition was about 23 basis points.

Question from Bank of America: Revisit the Capex outlook for Q4. We’ve had a number of companies suggest that things are slowing down. Yet your spending to date seems healthy. Also, take another crack at the topic: You’re seeing about half of smartphones on tiered plans. With more than half the base on smartphones — so the next 47 percent of the base will be taking cheaper smartphones, and next half is lower-tiered customers — can the ARPU still grow in the face of that?

Stevens on Capex: Our guidance remains unchanged. We have less than $15 billion so far, and still expect to spend $20 billion this year. Cash flow is funding it. We’ll continue to invest in LTE and in all the successful growing products. I expect Capex will continue in the $20 billion range. We’ll ramp it up a little get to that $20 billion range.

De la Vega: We’re going to see customers use more data, not less. These products are too good, an incredible amount of streaming content is available. No decline, and I don’t see any way that it could decline. We plan to make more tiered options available. What I see is exactly the opposite, where everyone is using more data.

Stevens: We have 18 million tiered customers, and we built that base in about a year. You’ve seen our churn, and frankly not sure you’ve noticed any harm. We’re well-positioned for that growth. Not only from a network capability and quality of service and ability to capture revenue.

7:51 am: What is overage from tiered plans contributing?

De la Vega: Not significant.

De la Vega: We’re going to have lots of data options. Also, what’s exciting is the tablet revolution. Customers will want both a smartphone and a tablet.

Question from Credit Suisse: A question on wireline margins, impact from the storms, and a negative shift in mix. Will there be margin expansion?

Stevens: I do believe the margins were impacted by the storms and other things. I still believe there is an opportunity to grow revenues and then have that impact on margin. The distinction: We did grow revenue. The growth was not dramatic, I don’t think anyone would have expected it to be dramatic. And we’re still feeling the pressure from the legacy products.

7:55 am: Question from Goldman Sachs: We’ve still seen deterioration in wireless voice ARPU. Are people trading down? Also, on handset upgrade rates. At 7 percent, it was the lowest rate we’ve seen in awhile.

De la Vega: We had a smaller impact as a result of the mobile-to-any-mobile plans in the third quarter. The biggest impact to the ARPU number was in data, not voice. Again, it’s a tricky compare because the last iPhone refresh happened in September, and not October as it did this year.

Final question from Deutsche Bank: Turnaround in prepaid plans.

De la Vega: We’ll continue to do well in GoPhone. I think the third quarter is a preview that should play out stronger in the fourth quarter. We have a great product and a great price.

7:59 am: That’s it. Stevens is recapping the results again. I’ll close out the post from here. Thanks for playing along.

The company also reported a drop in the number of Apple iPhones activated in its latest quarter, apparently for the same reason that Apple missed its results two days ago: Consumers knew that a new iPhone was imminent and held back on their purchases. It saw 2.7 million iPhones in the quarter, which is the lowest level in more than a year.

As part of an explanation for the slowdown, AT&T issued a separate statement saying it had activated one million iPhone 4S devices as of Tuesday. AT&T says that’s the most successful iPhone launch in its history. We’ll see how it compares with activations at Verizon Wireless on Friday.

AT&T added 2.1 million subscribers in the quarter and passed the 100 million mark for the first time. Wireless data revenues grew 18 percent to $857 million.

Revenue, at $31.5 billion, missed the consensus expectation of analysts of $31.62 billion. Per-share profits were 61 cents compared to $2.07 a share a year ago, and in line with the consensus.

Here’s AT&T’s full release. I’ll be dialing in to the conference call and liveblogging it, starting at 7 am PT, 10 am ET.

AT&T Reports Solid Earnings, Strong Cash Flow, Robust Mobile Broadband Sales and Improving Wireline Revenue Trends in Third-Quarter Results

$0.61 diluted EPS compared to $2.07 diluted EPS in the third quarter of 2010 and $0.54 when excluding one-time gains in the year-ago quarter
2.1 million increase in total wireless subscribers to pass 100 million subscribers, with gains in every customer category
Best free cash flow in two years even with higher capital spending
First sequential growth in wireline business revenues in three years
Best wireless EBITDA service margin performance in six quarters
Sales of Android and other non-iPhone smartphones were almost half of 4.8 million smartphone sales in the quarter
Branded computing subscribers (includes tablets, aircards, MiFi devices, tethering plans and other data-only devices) up 505,000, to reach 4.5 million
18.0 percent growth in wireless data revenues, up $857 million versus the year-earlier quarter
11th consecutive quarter with a year-over-year increase in postpaid subscriber ARPU (average monthly revenues per subscriber), up 1.4 percent to $63.69
Total churn improves; postpaid churn stable
Continued growth in strategic business services revenues, up 19.3 percent year over year
Fifth consecutive quarter of year-over-year growth in wireline consumer revenues, driven by AT&T U-verse® services
176,000 net gain in AT&T U-verse TV subscribers to reach 3.6 million in service, with continued high broadband and voice attach rates
19.6 percent growth in wireline consumer Internet Protocol (IP) data revenues to reach half of consumer revenues, driven by continued AT&T U-verse expansion

DALLAS–(BUSINESS WIRE)– AT&T Inc.* (NYSE:T – News) today reported third-quarter results, highlighted by solid earnings and free cash flow, continued strong mobile broadband growth and sequential growth in wireline business revenues.

“Mobile broadband growth continues to be robust, execution was strong across the business, and we delivered another solid quarter,” said Randall Stephenson, AT&T chairman and chief executive officer.

“Smartphones, connected devices and tablets all posted impressive gains. Our first LTE 4G markets are up and running with terrific speeds. And we continue to work toward a successful completion of our planned T-Mobile USA merger. The next waves in the mobile Internet revolution represent tremendous growth potential, and we are laying the groundwork required for that future.”

Third-Quarter Financial Results

For the quarter ended September 30, 2011, AT&T’s consolidated revenues totaled $31.5 billion, down $103 million, or 0.3 percent, versus the year-earlier quarter.

Compared with results for the third quarter of 2010, AT&T’s operating income margin was 19.8 percent, compared to 17.2 percent; operating expenses were $25.2 billion versus $26.2 billion; and operating income was $6.2 billion, up from $5.4 billion.

Third-quarter 2011 net income attributable to AT&T totaled $3.6 billion, or $0.61 per diluted share. These results compare with reported net income attributable to AT&T of $12.3 billion, or $2.07 per diluted share, in the third quarter of 2010, which included one-time gains from a tax settlement and the sale of Sterling Commerce. Excluding one-time gains, earnings were $0.54 in the third quarter a year ago.

Third-quarter 2011 cash from operating activities totaled $10.4 billion, and capital expenditures totaled $5.3 billion. Free cash flow — cash from operating activities minus capital expenditures — totaled $5.1 billion.

Compared with results for the first nine months of 2010, year to date through the third quarter, cash from operating activities totaled $27.2 billion versus $25.4 billion; capital expenditures totaled $14.7 billion compared to $13.7 billion; and free cash flow totaled $12.4 billion versus $11.6 billion.

WIRELESS OPERATIONAL HIGHLIGHTS

Led by continued strong performance in mobile broadband in the third quarter, AT&T continued to grow revenues, add subscribers, increase postpaid ARPU and expand margins. Highlights included:

Subscribers Pass 100 Million Mark. AT&T posted a net gain in total wireless subscribers of 2.1 million, to reach 100.7 million in service. This included gains in every customer category. Net adds for the quarter include postpaid net adds of 319,000. Excluding the impacts of the Alltel and Centennial integration migrations, postpaid net adds were approximately 384,000. Prepaid net adds were 293,000, connected device net adds were 1,038,000 and reseller net adds were 473,000. Third-quarter net adds reflect adoption of smartphones, increases in prepaid and reseller subscribers and sales of tablets and connected devices such as automobile monitoring systems, security systems and a host of other emerging products.

Strong Quarter for Branded Computing Device Sales. AT&T had another strong quarter with branded computing subscribers, a new growth area for the company that includes tablets, aircards, MiFi devices, tethering plans and other data-only devices. AT&T added 505,000 of these devices to reach 4.5 million, an almost 80 percent increase from a year ago. Most of those new subscribers were tablets, with 290,000 added in the quarter, of which more than 35 percent were postpaid.

Total Churn Improves, Postpaid Churn Stable. Total churn declined to 1.28 percent versus 1.32 percent in the third quarter of 2010 and 1.43 percent in the second quarter of 2011. Postpaid churn was 1.15 percent, compared to 1.14 percent in the year-ago third quarter and 1.15 percent in the second quarter of 2011. Excluding the impacts of the Alltel and Centennial migrations, postpaid churn of 1.11 percent for the quarter was unchanged versus the year-ago quarter.

Non-iPhone Smartphone Sales Increase. AT&T continues to deliver robust smartphone sales. (Smartphones are voice and data devices with an advanced operating system to better manage data and Internet access.) In the third quarter, the company sold 4.8 million smartphones, representing nearly two-thirds of postpaid device sales. Sales of Android devices more than doubled year over year, and almost half of all smartphone sales were non-iPhone devices. During the quarter, 2.7 million iPhones were activated.

At the end of the quarter, 52.6 percent of AT&T’s 68.6 million postpaid subscribers had smartphones, up from 39.1 percent a year earlier and 31.1 percent two years ago. The average ARPU for smartphones on AT&T’s network is 1.9 times that of the company’s non-smartphone devices. More than 85 percent of smartphone subscribers are on FamilyTalk® or business plans. Churn levels for these subscribers are significantly lower than for other postpaid subscribers. The number of subscribers on tiered-data plans continues to increase. About 18 million, or nearly half, of all smartphone subscribers are on tiered-data plans.

Wireless Revenues Grow. Total wireless revenues, which include equipment sales, were up 2.8 percent year over year to $15.6 billion. Wireless service revenues increased 4.3 percent, to $14.3 billion, in the third quarter.

Wireless Data Revenues Lead Growth. Wireless data revenues — driven by Internet access, access to applications, messaging and related services — increased by $857 million, or 18.0 percent, from the year-earlier quarter to $5.6 billion. AT&T’s postpaid wireless subscribers on monthly data plans increased by 16.5 percent over the past year. Versus the year-earlier quarter, total text messages carried on the AT&T network increased by 22 percent to 196.3 billion, and multimedia messages increased by 54 percent to 4.3 billion.

Postpaid ARPU Continues Growth. Driven by strong data growth, postpaid subscriber ARPU increased 1.4 percent versus the year-earlier quarter to $63.69. This marked the 11th consecutive quarter AT&T has posted a year-over-year increase in postpaid ARPU. Postpaid data ARPU reached $25.14, up 14.2 percent versus the year-earlier quarter.

Wireless Margins Expand. Third-quarter wireless margins reflect strong smartphone sales, solid customer upgrade levels and some residual Alltel and Centennial merger costs. This was offset in part by improved operating efficiencies and further revenue gains from the company’s growing base of high-quality smartphone subscribers. Year-over-year comparisons are also influenced by the launch of iPhone 4 at the end of the second quarter a year ago.

AT&T’s third-quarter wireless operating income margin was 29.6 percent versus 23.1 percent in the year-earlier quarter, and AT&T’s wireless EBITDA service margin was 43.7 percent, compared with 37.6 percent in the third quarter of 2010. Without customer migration and integration costs from the Alltel and Centennial mergers, the EBITDA service margin would have been 44.0 percent. (EBITDA service margin is earnings before interest, taxes, depreciation and amortization, divided by total service revenues.) Third-quarter wireless operating expenses totaled $11.0 billion, down 5.9 percent versus the year-earlier quarter, and wireless operating income was $4.6 billion, up 31.7 percent year over year.

WIRELINE OPERATIONAL HIGHLIGHTS

AT&T’s third-quarter wireline results were highlighted by the first sequential growth in wireline revenues in more than four years. Other highlights included:

Wireline Consumer Revenues Stable. Driven by strength in IP data services, revenues from residential customers totaled $5.3 billion, an increase of 0.2 percent versus the third quarter a year ago, the fifth consecutive quarter of year-over-year growth.

U-verse Attach Rate Drives ARPU Growth. AT&T U-verse TV added 176,000 subscribers to reach 3.6 million in service. In the third quarter, the AT&T U-verse High Speed Internet attach rate was 90 percent and about half of new subscribers took AT&T U-verse Voice. Three-fourths of AT&T U-verse TV subscribers have a triple- or quad-play option from AT&T. ARPU for U-verse triple-play customers was almost $170, up 5.7 percent year over year.

AT&T’s U-verse deployment now reaches almost 30 million living units. Companywide penetration of eligible living units is 15.7 percent, and 24.8 percent across areas marketed to for 36 months or more. AT&T’s total video subscribers, which combine the company’s U-verse and bundled satellite customers, reached 5.4 million at the end of the quarter, representing 22.6 percent of households served.

U-verse Broadband Continues Strong Growth. AT&T U-verse High Speed Internet delivered a third-quarter gain of 504,000 subscribers to reach a total of 4.6 million, helping offset losses from DSL. Overall, AT&T posted a slight net gain in wireline broadband connections. More than 70 percent of consumers have a broadband plan of 3 Mbps or higher.

IP Data Half of Consumer Revenues. U-verse continues to drive a transformation in wireline consumer, reflected by the fact that consumer IP revenues now represent 50.9 percent of wireline consumer revenues, up from 42.6 percent in the year-earlier quarter. Increased AT&T U-verse penetration and a significant number of subscribers on triple- or quad-play options drove 19.6 percent year-over-year growth in IP revenues from residential customers (broadband, U-verse TV and U-verse Voice) and 2.9 percent sequential growth. U-verse revenues grew 50.1 percent compared with the year-ago third quarter and were up 6.0 percent versus the second quarter of 2011.

Continued Growth in Revenues Per Household. Wireline revenues per household served increased 5.0 percent versus the year-earlier third quarter and were up 1.4 percent sequentially (average revenues per household is total wireline consumer revenues divided by the average monthly households in service), driven by AT&T U-verse services. This marked AT&T’s 15th consecutive quarter with year-over-year growth in wireline consumer revenues per household as U-verse scales and represents a larger portion of wireline consumer revenues.

Consumer Connection Trends Continue. In the third quarter, AT&T posted a decline in total consumer revenue connections primarily due to expected declines in traditional voice access lines, consistent with broader industry trends and somewhat offset by increases in U-verse TV, broadband and VoIP (Voice over Internet Protocol) connections. AT&T U-verse Voice connections increased by 119,000 in the quarter and 648,000 over the past four quarters. Total consumer revenue connections at the end of the third quarter were 41.9 million, compared with 43.7 million at the end of the third quarter of 2010 and 42.5 million at the end of the second quarter of 2011.

Wireline Business Revenues Grow Sequentially. Total business revenues were $9.3 billion, an increase of 0.7 percent sequentially and down 2.7 percent versus the year-earlier quarter. The year-over-year decline reflects economic weakness in voice and legacy data products somewhat offset by growth in IP data. Excluding the effect of the third-quarter 2010 sale of Japan assets, business service revenues, which exclude CPE, declined 1.7 percent year over year, compared to a year-over-year decline of 3.4 percent in the year-ago quarter.

Robust Strategic Business Services Revenues. Revenues from the new-generation capabilities that lead AT&T’s most advanced business solutions — including Ethernet, VPNs, hosting, IP conferencing and application services — grew 19.3 percent versus the year-earlier quarter, continuing strong trends in this area. This now represents a nearly $5.8 billion annualized revenue stream.

VPN Growth Drives Business IP Revenues. Total business IP data revenues grew 10.2 percent versus the year-earlier third quarter, led by growth in VPN revenues. IP-based solutions allow customers to easily add managed services such as network security, cloud services and IP conferencing on top of their infrastructures. Total business data revenues grew 1.8 percent year over year.

Wireline Revenues Increase Sequentially. Third-quarter total wireline revenues were $15.0 billion, down 2.2 percent versus the year-earlier quarter but up slightly sequentially. Third-quarter wireline operating expenses were $13.2 billion, down 1.3 percent versus the third quarter of 2010 and up 1.3 percent sequentially. Wireline operating income totaled $1.8 billion, down from $2.0 billion in the third quarter of 2010 and down versus the second quarter of 2011. AT&T’s third-quarter wireline operating income margin was 12.1 percent, compared to 13.0 percent in the year-earlier quarter and down from 13.1 percent in the second quarter of 2011. Improved consumer and business IP data revenue trends and execution of cost initiatives helped to partially offset declines in voice revenues.

*AT&T products and services are provided or offered by subsidiaries and affiliates of AT&T Inc. under the AT&T brand and not by AT&T Inc.

At the fall CTIA show on Tuesday, the same executives were assembled, but things weren’t nearly as fun. First of all, there was no Mr. Boo-ya. More importantly, the executives appeared one after the other, rather than agreeing to again share a stage.

The result was more stump speeches than discourse.

Sprint CEO Dan Hesse, who is also the chairman of the CTIA, kicked things off with a talk largely focused on environmental issues, noting that the industry trade group plans later today to announce new guidelines for product reuse, recycling and packaging.

“We’re making real progress,” Hesse said. He also noted that it was cellphones that transmitted dramatic imagery from the Middle East as governments changed, and wireless phones that helped after natural disasters in the U.S. and around the globe.

Ralph de la Vega, CEO of AT&T Mobility, focused on some of the investments his company has made, including $80 million to open research “foundries” in Palo Alto, Calif.; Plano, Texas; and Israel.

The speeches weren’t totally devoid of zingers. Hesse did note that de la Vega looks a lot like Lincoln assassin John Wilkes Booth, who was also an actor. Speaking after Hesse, de la Vega noted the observation came from Hesse, “a guy who is the best actor in wireless we have today.”

De la Vega was followed by Verizon Wireless CEO Dan Mead.

Like de la Vega, Mead spoke about his company’s investment in facilities that help network equipment makers, operating system creators and app developers to collaborate. Verizon opened an application center in San Francisco earlier this year, following on the heels of an earlier 4G LTE center in Waltham, Mass.

Mead also spoke about the impact the industry has had on society in the decade since Sept. 11, 2001, when, he said, the wireless business established itself as a key aid to first responders in the aftermath of crises.

“Since that time, we’ve responded to hurricanes and tornadoes and floods, helping people to cope,” Mead said. “We have rescued hikers, boaters and others who have lost their way. We have used our technology for the greater good again and again.”

Although Mead and others talked about the competitiveness of the industry, Tuesday was more lovefest than slugfest.

“Collaboration has played and will continue to play a major role in our success,” Mead said.

For its part, AT&T can highlight the fact that the iPhone 4S runs on its faster HSPA+ network, and that owners can talk and surf at the same time. Also, it will be the only U.S. carrier offering the iPhone 3GS, which will now be free with a new two-year contract.

“We feel like the new phone, when it runs on our 4G network, is going to download material twice as fast,” AT&T Mobility President Ralph de la Vega told AllThingsD in an interview on Tuesday. “When you combine that with a new portfolio that includes the iPhone 3GS, the iPhone 4 and the iPhone 4S, I think we have the best iPhone portfolio in the industry.”

The company also hopes to convince subscribers to stick with AT&T by introducing a new “upgrader” app that will let eligible customers order a new iPhone from their current device.

Verizon, meanwhile, continues to pitch the quality of its network as its chief selling point.

“The network matters,” chief marketing officer Marni Walden said in a statement. “And, while iPhone 4S may look like the same device across all carriers, customers know they are choosing reliability when they select a Verizon Wireless iPhone 4S.”

The big news for Sprint, of course, is the fact that it is finally getting the iPhone after a wait of several years. In addition, Sprint remains the lone iPhone carrier offering unlimited data plans to new smartphone subscribers, something that is expected to continue even with the iPhone joining its lineup. Both AT&T and Verizon initially offered unlimited data to iPhone customers, but later moved to tiered data pricing.

Sprint declined to talk in any detail about its iPhone plans, saying only that it was “delighted to be part” of the iPhone announcement and would have more information soon.

“Today is all about the new products being announced by our partners at Apple,” a Sprint representative said on Tuesday.

Although it wasn’t highlighted on stage, Sprint is also getting the $99 iPhone 4, in addition to the new iPhone 4S.

None of the major carriers went into detail on their rate plans and other particulars on Tuesday, though all are expected to do so this week, with preorders for the device slated to start on Friday. The iPhone 4S is scheduled to start shipping — and to hit stores (at least until they sell out) — on Oct. 12.

Left out in the cold, as expected, is T-Mobile USA. As is the case with the iPhone 4, not only does the carrier not have a deal with Apple to sell the device directly, but the GSM version of the phone doesn’t support T-Mobile’s 3G or 4G networks. Even with that condition, T-Mobile noted earlier this year that it has more than one million iPhones running on its network today.

Apple does plan to offer an unlocked version of the iPhone 4S, but it has yet to announce pricing and, for technical reasons, it is really more suited to AT&T customers that travel a lot internationally than it is to switching between CDMA and GSM networks.

The fact that a single iPhone 4S model works across Sprint, Verizon and AT&T does open up some interesting possibilities for when a customer is at the end of their two-year contract. In theory, it could be simple to move that phone to another carrier, though it remains to be seen what roadblocks, if any, will emerge.

RELATED POSTS:

• Commas, Zeros and No. 1: Apple’s iPhone 4S Event by the Numbers
• In Depth With Siri: The Full Demo From the D7 Conference (Plus an Old-School Bonus)
• Tim Cook Follows Steve Jobs’s Footsteps Closely in Big Stage Debut
• Just Like We Didn’t Tell You: No Apple-Facebook Tie-Up Today
• Why Siri Sounds Like a Lady
• I Am Number 4S? — No Sparkly iPhone 5 Disappoints Apple Fans (and Wall Street)
• Exclusive: AT&T’s New App Will Let You Get a New iPhone — From Your Existing iPhone
• Apple’s Quiet iPhone Move: More Price Pressure
• Apple Wants You to Meet Siri, Your New Personal Assistant
• Apple’s Game Center Scores 67 Million Players
• So What Puts the S in the New iPhone 4S?
• Apple’s “Find My Friends” Location Feature Is More Like Glympse Than Foursquare
• Apple Updates iPods with Cheaper iPod Touch and Nano
• Apple Turns the iPhone into a Hallmark Store
• Apple’s “Let’s Talk iPhone” Event, LIVE
• Even If He’s Not at Apple Event, Steve Jobs Sure Knows How to Put on a Show
• Viral Video: The iPhone 5 as Love Potion #9
• Mostly Sunny With 100 Percent Chance of Apples
• What’s Behind a Tim Cook Apple Event (Comic)
• Apple Launching iPhone 5 in October
• Apple’s Next Event to Be Held on October 4, Starring Its New CEO
• October iPhone Event to Be Held on Apple Campus
• Apple Announces October 4 Event: Let’s Talk iPhone

In an interview, AT&T mobility head Ralph de la Vega told AllThingsD that the capability will be available as an iPhone app shortly, although a similar capability should be available on other devices via the mobile Web.

“Customers will be able to upgrade to the new phones, just by using their phone,” de la Vega said. “The phone gets shipped right to their home.”

De la Vega said that the new app will come in handy with an expected heavy demand for the just-introduced iPhone 4S.

“They don’t even have to visit the store,” de la Vega said. “It’s frictionless updating at a time when customers are going to want this phone for the holidays.”

However, there won’t be a change in when customers will be eligible to upgrade to the new phones, he said.

“We’re not changing the upgrade policies. We’re just making it easier.”

AT&T has new competition as Sprint will also get the new iPhone, Apple said at its event on Tuesday.

RELATED POSTS:

• Commas, Zeros and No. 1: Apple’s iPhone 4S Event by the Numbers
• In Depth With Siri: The Full Demo From the D7 Conference (Plus an Old-School Bonus)
• Tim Cook Follows Steve Jobs’s Footsteps Closely in Big Stage Debut
• Just Like We Didn’t Tell You: No Apple-Facebook Tie-Up Today
• Why Siri Sounds Like a Lady
• I Am Number 4S? — No Sparkly iPhone 5 Disappoints Apple Fans (and Wall Street)
• Exclusive: AT&T’s New App Will Let You Get a New iPhone — From Your Existing iPhone
• Apple’s Quiet iPhone Move: More Price Pressure
• Apple Wants You to Meet Siri, Your New Personal Assistant
• Apple’s Game Center Scores 67 Million Players
• So What Puts the S in the New iPhone 4S?
• Apple’s “Find My Friends” Location Feature Is More Like Glympse Than Foursquare
• Apple Updates iPods with Cheaper iPod Touch and Nano
• Apple Turns the iPhone into a Hallmark Store
• Apple’s “Let’s Talk iPhone” Event, LIVE
• Even If He’s Not at Apple Event, Steve Jobs Sure Knows How to Put on a Show
• Viral Video: The iPhone 5 as Love Potion #9
• Mostly Sunny With 100 Percent Chance of Apples
• What’s Behind a Tim Cook Apple Event (Comic)
• Apple Launching iPhone 5 in October
• Apple’s Next Event to Be Held on October 4, Starring Its New CEO
• October iPhone Event to Be Held on Apple Campus
• Apple Announces October 4 Event: Let’s Talk iPhone

For a couple of months now, France Telecom’s Orange unit has been allowing iPad owners in Austria to share one allotment of data with a phone, while other shared data plans were recently launched in France, the United Kingdom and Spain.

Although the plans vary somewhat by country, the basic premise is the same. Users pay an extra couple of dollars a month for each additional device that shares data — similar to the way families and businesses here have long been able to share minutes between multiple phones.

“We believe that’s really a way for the future,” said Olaf Swantee, senior executive vice president for France Telecom’s Orange unit.

And while France Telecom appears to be the first major carrier to offer such plans, others are likely to follow suit. At last month’s D9 conference, AT&T executive Ralph de la Vega confirmed that some sort of shared plan is in the works.

“We’re working on one,” de la Vega said in the onstage interview. “It will be soon. I can’t comment on a quarter (when it will launch) but it will be soon.”

An AT&T representative declined to comment further. Verizon CFO Fran Shammo also said recently that company is exploring such an offer.

The move to offer such data plans could become increasingly important as carriers look to shift away from unlimited data plans, in favor of those where customers pay for a certain amount of megabytes or gigabytes. Although the concept is inherently a bit tricky for users to get their heads around, it could ultimately become more palatable if all those bytes could be shared among different devices.

Currently, the need to sign up for an entirely new data plan is acting as a disincentive for many customers to buy additional devices with built-in cellular connections. Instead, users have gravitated toward Wi-Fi equipped devices, in some cases pairing those with a mobile hotspot. Such hotspots connect to the cellular data network and then distribute that connection over Wi-Fi to any number of nearby devices. Using a hotspot, though, requires all devices being used to be nearby one another — and the hotspot is yet another device to carry around and charge.

As for the France Telecom plan, early results are encouraging. In Austria, the country where France Telecom has been offering the plans the longest, the company said that 38 percent of all iPads on its network are now using the shared data plans.

Shared data plans are just one of the moves Orange is making as digital devices and smartphones go mainstream.

Swantee said it is part of an effort to offer a broader array of services to its customers.

“We are talking to customers and not SIM cards,” he said. Over time, Swantee said, the efforts could stretch beyond rate plans and also extend to services that could be used on multiple mobile devices, as well as over landline connections.

“We really believe in the long run you will have people that want to have an experience that works across different devices,” Swantee said.

That’s one of the first questions that AT&T wireless boss Ralph de la Vega had to face at the D9 conference this month. Good thing he came prepared!

Also on the agenda for the wide-ranging discussion: The Verizon iPhone, the company’s LTE rollout, the impending spectrum crisis and the role of the carrier in the age of mobile ecosystems.

]]> http://allthingsd.com/20110624/ralph-de-la-vega-says-att-can-better-as-it-gets-bigger-the-full-d9-interview-video/feed/ 0 http://allthingsd.com/20110604/exclusive-atts-ralph-de-la-vega-on-which-smartphones-are-winning/ http://allthingsd.com/20110604/exclusive-atts-ralph-de-la-vega-on-which-smartphones-are-winning/#comments Sat, 04 Jun 2011 13:00:32 +0000 Ina Fried http://allthingsd.com/?p=82529 After his on-stage grilling on Thursday, I had a chance to catch up with AT&T’s Ralph de la Vega to talk about some of the trends that AT&T is seeing.

It turns out he’s seeing a lot of the same things that the rest of the industry is seeing–namely the rise of Android, the continued strength of the iPhone and struggles for others, including BlackBerry. And, while AT&T has been one of the biggest supporters of Windows Phone, de la Vega acknowledged that the sales haven’t been what either AT&T or Microsoft would have liked.

“We actually like that software very, very much,” de la Vega said. “It hasn’t sold as well as Microsoft or we would want it to.”

However, he noted that it is essentially a version one of a new operating system and said he still has high hopes for the future, particularly if both Microsoft and new hardware partner Nokia can execute on their vision.

“I think for the first thing out of the chute it is pretty good,” de la Vega said. “I think they just need to make it better….Giving customers more application choices, having a bigger app store with more functionality on the phone–I think that is all that it needs.”

Here’s an edited transcript of our conversation:

AllThingsD: You guys have always offered the broadest range of smartphones. What are the trends?

De la Vega: They definitely are buying a lot less feature phones than they used to. We’ve seen a dramatic shift from feature phones and quick messaging devices, which were texting devices only, into smartphones. We love that.

Android is becoming more popular. Our Android business is doing very, very well. I think what’s happening is people have latched on to smartphones. I think over time there will be fewer and fewer feature phones.

There are a million Android devices. Do you want to see more customization? I know at Mobile World Congress you said that you would carry the HTC device that is very Facebook-centric. Do you want to see more devices like that, that are a little more specialized?

De la Vega: I think you are going to see more people put a different UI on top of Android, like HTC has very successfully done. I love what they have done with their UI. It’s very simple, but it is still Android. I hope others will step up to the plate and Android itself will get better.

Nokia has made this huge bet on Windows Phone. One of the reasons, they have said, is to have a bigger presence then they have had in many years in North America. How interested are you in adding them to your lineup?

De la Vega: We already have Windows Phone 7 in our lineup. We actually like that software very, very much. It hasn’t sold as well as Microsoft or we would want it to, but I think having the Nokia hardware capability with the Microsoft software capability is a really good combination. They have to prove it by bringing some great devices to market. But I would love to have a great Nokia device with Microsoft Windows Phone 7.

Windows Phone 7, is it a hard sell, or are their features that are missing?

De la Vega: Keep in mind this is the first product that Microsoft has come out with since Microsoft redid their OS. I think for the first thing out of the chute it is pretty good. I think they just need to make it better. If you listen to what Steve Ballmer is saying (Mango, the next version), is going to add about 500 features. I think they are going to make it a lot better. Giving customers more application choices, having a bigger app store with more functionality on the phone, I think that is all that it needs.

Actually, I loved Windows 8. That looks a lot like a Windows Phone screen, with the tiles. I think that’s a huge win for Microsoft. Now they have their same look and feel on their PCs and tablets as they have on their smartphones.

Is there really a tablet market or is it at this point still an iPad market? Do people come in looking for something other than an iPad?

De la Vega: I think you are going to see more and more people come in to look at other tablets that may look interesting to them. I think it is going to be up to the competition to challenge Apple, not only on the software, but also on the hardware. What Apple has done very well is killer software, but the hardware is beautiful. I think they are raising the bar very high, but this is a competitive industry. I am pretty sure the other guys are not going to sit still and let Apple have all of that market share.

Originally, I think you were planning to carry the Motorola Xoom. Is that still what you guys are planning?

De la Vega: We’re still planning to carry it. We’re still working with Motorola on a few issues. But we are planning to carry multiple tablets, not just Motorola but several others as well.

All of the people that offer us smartphones, Ina, are offering us tablets. The question is which ones of those are good enough to stand up to the iPad. That’s a very high bar.

Historically, one of the big consumer smartphone devices has been the BlackBerry. With the Curve, they really did help expand the smartphone market, but clearly their sales lately have not been what they were. What sort of feedback have you given them?

De la Vega: I think customers want more applications and they are going to eventually move to where they have one OS. Right now they have OS 7 and they have QNX.

Are you guys being more cautious about your plans? Have you scaled back from maybe where you thought a year ago you would be in terms of BlackBerries?

De la Vega: We don’t necessarily scale back. We offer their full product line. We just see customers in some cases choosing other products rather than traditional BlackBerries.

What have been the positive surprises? We talked about how BlackBerry has had a rough time and with Windows Phone, even though you like the product, the volume hasn’t been maybe what you hoped for.

De la Vega: iPhone and Android. I’ve been very pleased with HTC. HTC has come out with the HTC Inspire and it is selling extremely well in our stores. I think HTC has done a great job with the user interface. You go in and it is distinctive and I think other players are going to have to step up to that. So, Android and Apple are really the hot products right now.

I was talking with the CEO of France Telecom a week or two ago. One of the things he was talking about was working with Apple toward a standard of an even smaller SIM card. Is that something you guys are at all interested in?

De la Vega: We’re working with the industry to look at how to take a smaller footprint device with the SIM card. I think that probably will happen.

You are more interested in helping to make that happen than seeing some e-SIM sort of approach?

De La Vega: We think that making the card smaller and shrinking the size is a no-brainer and we should be able to make that happen.

Am I going to see you on Monday in San Francisco at Apple’s Worldwide Developer Conference?

De La Vega: Unfortunately I can’t be there on Monday. I have other commitments, but I’m anxious to see what Steve has to say. It looks like he is going to be on the stage. That’s really great news. I’m glad he is healthy enough to be back. We’ll be glad to have him back.

]]> http://allthingsd.com/20110604/exclusive-atts-ralph-de-la-vega-on-which-smartphones-are-winning/feed/ 0 http://allthingsd.com/20110603/atts-de-la-vega-were-improving-video/ http://allthingsd.com/20110603/atts-de-la-vega-were-improving-video/#comments Fri, 03 Jun 2011 14:47:02 +0000 John Paczkowski http://allthingsd.com/?p=82246 With competitors and interest groups asking the Federal Communications Commission to block AT&T’s proposed $39 billion takeover of T-Mobile, there was lots to talk about in the final session of D9 with AT&T Mobility President and CEO Ralph de la Vega. Regulatory issues were top of mind, but there were other things as well: The Verizon iPhone, the company’s LTE rollout, the impending spectrum crisis and the role of the carrier in the age of mobile ecosystems. Video highlights below.

]]> http://allthingsd.com/20110603/atts-de-la-vega-were-improving-video/feed/ 0 http://allthingsd.com/20110602/att-ceo-service-improvements-will-continue-with-t-mobile-deal/ http://allthingsd.com/20110602/att-ceo-service-improvements-will-continue-with-t-mobile-deal/#comments Thu, 02 Jun 2011 18:38:26 +0000 John Paczkowski http://allthingsd.com/?p=82000 Why should we believe that AT&T is competent enough to control what will be the biggest network in the U.S., when it’s consistently rated as providing the worst service?

Because the network’s going to be much better and AT&T’s getting better at managing it.

While acknowledging concerns about the company’s recent record, AT&T Mobility President and CEO Ralph de la Vega said it really does deserve to control the biggest share of the U.S. wireless market.

“We’re not happy with the status of customer satisfaction and we’re working to improve it,” he said onstage at D9 today. “Our customers are happier than they were before….When we overlay our network with T-Mobile’s you’ll see a dramatic improvement….Our customers will be able to use any cell site, AT&T or T-Mobile, and that will give them an immediate benefit….We are pulling every lever humanly possible to improve our service.”

]]> http://allthingsd.com/20110602/att-ceo-service-improvements-will-continue-with-t-mobile-deal/feed/ 0 http://allthingsd.com/20110602/atts-ralph-de-la-vega-is-the-final-guest-on-the-hot-seat-live-at-d9/ http://allthingsd.com/20110602/atts-ralph-de-la-vega-is-the-final-guest-on-the-hot-seat-live-at-d9/#comments Thu, 02 Jun 2011 17:56:43 +0000 Ina Fried http://allthingsd.com/?p=82159 Trying to buy T-Mobile USA for $39 billion. Looking to fend off new competition with Verizon over the iPhone. The looming spectrum crunch and the shift away from unlimited data pricing.

Too bad there is nothing to talk to AT&T executive Ralph de la Vega about. He’ll be the wrap-up speaker here at the D9 conference, and this is the spot for live coverage of his talk.

10:58 am: Talk begins with de la Vega outlining the benefits AT&T sees from the T-Mobile merger.

10:59 am: Kara notes that she just left AT&T for Verizon, and only partly to get the shiny new white iPhone. Also because her AT&T iPhone was dropping calls.

11:00 am: Walt: Why should we believe that AT&T is competent to manage the biggest carrier, when AT&T is consistently rated as providing the worst service?

De la Vega: We’re not happy or satisfied, but improving. “We’re improving and taking the levels of customer satisfaction higher and higher.” AT&T says what it is seeing in data growth is more than any other carrier in the world.

“We, today, have the most smartphones of any provider in the world,” he says.

De la Vega talks about how AT&T has devoted more spectrum to New York City than has been seen in any carrier in any city in the world.

Walt points out that AT&T customers there still aren’t satisfied.

De la Vega says it is improving. He also notes that the company set a record for iPhone shipments even in the first quarter it had competition from Verizon.

“I think that customers are seeing improvement,” he says. “We are not happy where we are.”

11:04 am: Kara: Going from four to three is a big deal, though. When you get to a big size, what kind of leverage does anyone have if they are unhappy?

De la Vega points to the fact many markets have five or more competitors.

Walt points out that those are small.

De la Vega points out that in L.A., where D9 is, Metro PCS is the number four carrier and T-Mobile is number five.

11:06 am: De la Vega notes that Metro PCS and Leap added more total customers in the first quarter than AT&T and Verizon.

“To me, that’s what makes the industry dynamic,” de la Vega says.

De la Vega says the U.S. is the least-concentrated market in the world today. “The combination, I don’t think, will keep that competition from happening.”

11:09 am: De la Vega on company’s 4G efforts:

He notes that the company felt it had pretty good tech with HSPA+ so didn’t need to move as fast as Verizon with LTE. That said, LTE is working well and AT&T expects to move quickly.

“I think you will see us be very competitive with LTE,” he says.

Walt: When will you catch up with Verizon?

De La Vega: Within two to three years, LTE coverage will be indistinguishable.

11:10 am: Walt: Dan Hesse says this merger will kill them.

De la Vega: “I can’t refute what he says, but I think Sprint has done well in this environment.”

Sprint, combined with Clearwire, he says, has more spectrum than any carrier in this industry.

“They have a huge amount of spectrum.”

11:12 am: Walt: Although Sprint owns 54 percent of Clearwire, they can’t seem to control them. Noting that the two compete.

De la Vega: That’s an internal problem.

Walt: But Verizon is really your only major competitor.

Verizon, of course, is a main competitor. But Sprint is a viable competitor, plus a lot of local competitors, plus LightSquared (a wholesale start-up).

As for pricing, de la Vega reiterates the argument that wireless costs have dropped by 50 percent in 10 years, despite a bunch of big mergers.

11:14 am: Walt: “So you must have been way overcharging four or five years ago.”

De la Vega: No. Each generation, data costs drop.

11:16 am: Walt: Why is it so hard in San Francisco?

De la Vega: In San Francisco, he says, it takes two to three times longer to build or upgrade a cell site than it does in a lot of other places.

“We’re pulling every lever humanly possible.”

Walt: And what’s the problem in New York. Is it Mayor Bloomberg?

De la Vega: Bloomberg loves his iPad. He’s our customer.

11:19 am: Kara shifts talk to relationships with Apple and Google and the changed landscape.

De la Vega reiterates point made by Nokia CEO Stephen Elop that it is now an ecosystem game.

“We want to give the customers the choice,” he says, noting AT&T carries just about every platform out there.

11:20 am: De la Vega does make choices. He notes that the company recently scrapped a planned product launch. By the time we got it, it was already late to market.

He didn’t specify the product–says it’s not the Nokia one.

11:21 am: Walt: What is the role of the carrier?

De la Vega: If you look at the AT&T infrastructure, we have all of the infrastructure that enables this to happen.

“We enable all of this innovation to come to market.”

Kara: Have you lost power in that dynamic?

De la Vega: “I think the future is going to require more collaboration.”

Walt, on iPhone collaboration with Apple, “The collaboration was ‘You can’t touch this.’”

De la Vega disputes this, saying AT&T gave Apple a lot of know-how.

Same with working with Microsoft on U-verse TV, he said.

“I hope that people view us as a good collaborator.”

11:25 am: Walt: Could you please tell us exactly what the new iPhone will look like?

De La Vega: Can’t comment. (Shocking.)

You have to learn how to work with different companies. In the case of Apple, they are very, very concerned about their information getting out. He says the company has put a lot of processes in place to keep that info secret.

11:27 am: Walt: The tablet market is essentially an iPad market today. One interesting thing is that the iPad is sold unsubsidized, with no contract.

De la Vega notes that it helped make that possible on the iPad. “That’s our software in collaboration with Apple.”

As for whether that’s the future of tablets, the jury is still out.

And, as people carry more and more devices, “you may want a shared plan,” he says. “We’re working on one.”

How soon?

“It will be soon. I can’t comment on a quarter (when it will launch) but it will be soon.”

11:30 am: Moving on the the Q&A now. JP picking up for Ina, who’s off to snag another interview.

11:31 am: Why won’t AT&T unlock iPhones for overseas use after contracts are up?

Unlocking is always a big issue when you give someone a hugely subsidized device, says de la Vega, adding that folks are welcome to pay the full retail price and take the device wherever they like.

11:33 am: Not sure anyone understood that last question, which I’m at a loss to transcribe here.

11:34 am: But here’s the answer to it anyway. “When people use our network, they pay for it, and when they don’t, they don’t.”

11:34 am: Question about femtocells.

De la Vega says AT&T doesn’t give them out or encourage people to buy them unless customers are obviously in very low-signal areas.

11:35 am: Inevitable cellphones cause brain cancer question.

World Health Organization didn’t do any new studies to support its latest report, says de la Vega. That data is a year old. Which is not to say that it’s not concerning, but perhaps that it’s being made out to be a bit more than it is. “We should continue to study the matter,” he says.

11:37 am: Jason Calacanis would like a discount on his lousy AT&T service.

11:40 am: De la Vega dodges the question, but is ultimately forced to provide this answer: “If a customer calls us and there’s a history of problems, our reps are authorized to provide a discount.”

11:42 am: What’s your plan if the merger doesn’t happen?

Great question, but peripheral discussion quickly drags it into the weeds.

11:44 am: Ah. Here’s the answer. “Our plan is this: We still have sufficient spectrum to have a big footprint and cover a major portion of the U.S. in LTE. We’re going to be fine whether the merger happens or not.”

11:45 am: Aren’t there other ways of addressing the spectrum crunch than buying T-Mobile? And is there really a spectrum crunch? Because the NAB says there isn’t.

De la Vega says that despite what the NAB says, there is going to be a crunch. “There’s no question in my mind that crunch is occurring. I don’t know why the NAB is taking the stance they’re taking.”

He adds that he’s pleased the FCC has taken an interest in this issue.

]]> http://allthingsd.com/20110602/atts-ralph-de-la-vega-is-the-final-guest-on-the-hot-seat-live-at-d9/feed/ 0 http://allthingsd.com/20110323/ctia-notebook-so-where-were-you-when-att-news-hit/ http://allthingsd.com/20110323/ctia-notebook-so-where-were-you-when-att-news-hit/#comments Wed, 23 Mar 2011 19:06:42 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5465 It’s both the icebreaker for conversations and the topic that no one wants to talk about.

Meet up with anyone in Orlando for CTIA and the first topic is likely to be where you were on Sunday when you first heard about AT&T’s plan to buy T-Mobile.

For answers, I’ve heard everything from cooking to napping to arm-deep in Play-Doh. Nearly all of T-Mobile USA’s PR team was on a plane to Orlando when the news broke. HTC North America head Jason Mackensie was watching his son play at a basketball tournament in Texas when his phone started buzzing with messages from co-workers, as well as folks from both carriers.

But, seek to discuss the topic of the merger in detail and few will comment.

Samsung Mobile Senior Vice President Omar Khan had to be pressed to answer whether he was surprised or not. Eventually, Khan admitted he was surprised, but declined any further comment on the deal. Many other executives and non-executives followed suit, most notably FCC Chairman Julius Genachowski–one of the people whose opinion matters the most.

“Of course you will understand I am not going to comment on that,” he said during an on-stage appearance.

Those that do offer up a comment usually characterize it as good news or business as usual.

“The fortunate thing is we’ve got good relationships with both companies,” Mackenzie said.

Oddly enough, the people most willing to talk are those closest to the deal. Sprint is vocally concerned, while Verizon Wireless CEO Dan Mead says that he isn’t going to get distracted and assumes the deal will probably go through.

“I do have concerns that it would stifle innovation and too much power would be in the hands of just two,” Sprint CEO Dan Hesse said during a keynote in which he shared the stage with Mead and AT&T’s Ralph de la Vega.

Mead, meanwhile, appeared unshaken. “We have a tremendous amount of competition in the industry,” he said, adding that the industry will go through continued change, such as the AT&T purchase. “I’m not concerned about it.”

For everyone else in the industry, it is both the thing on everyone’s mind and the topic no one is quite ready to discuss.

]]> http://allthingsd.com/20110323/ctia-notebook-so-where-were-you-when-att-news-hit/feed/ 0 http://allthingsd.com/20110322/sprint-verizon-diverge-in-reaction-to-att-t-mobile-deal/ http://allthingsd.com/20110322/sprint-verizon-diverge-in-reaction-to-att-t-mobile-deal/#comments Tue, 22 Mar 2011 14:30:37 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5411 Sprint and Verizon Wireless are taking markedly different positions when it comes to AT&T’s pending deal to acquire T-Mobile USA.

Speaking at the CTIA 2011 event in Orlando, Sprint CEO Dan Hesse reiterated his company’s concerns that the deal would concentrate too much power in the hands of Verizon and AT&T.

“I do have concerns that it would stifle innovation and too much power would be in the hands of just two,” he said.

Sharing the same stage, Verizon Wireless CEO Dan Mead said that the company is clearly watching things, but noted that his company was built through acquisitions.

“We have a tremendous amount of competition in the industry,” he said, adding that the industry will go through continued change, such as the AT&T purchase. “I’m not concerned about it.”

Mead said that his company had not considered a purchase of T-Mobile ahead of the deal and also told Reuters that his company isn’t pondering acquiring rival Sprint.

As for the AT&T-T-Mobile deal, Hesse noted that it doesn’t really matter what he thinks, since it will be regulators at the Department of Justice, FCC and elsewhere that get to decide.

FCC Chairman Juiius Genakowski, who spoke before the CEO panel, acknowledged the elephant in the room, but declined comment on the deal.

AT&T’s Ralph De La Vega didn’t say too much about the deal, other than to repeat the company’s case that the deal is in the public interest as it helps alleviate the looming spectrum crunch and will expand high-speed LTE service to more of the U.S.

]]> http://allthingsd.com/20110322/sprint-verizon-diverge-in-reaction-to-att-t-mobile-deal/feed/ 0 http://allthingsd.com/20110322/live-att-verizon-and-sprint-face-off-at-ctia/ http://allthingsd.com/20110322/live-att-verizon-and-sprint-face-off-at-ctia/#comments Tue, 22 Mar 2011 13:23:37 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5399 In the wake of AT&T’s blockbuster T-Mobile USA deal, top executives from the three big U.S. carriers are set to share the stage in Orlando.

Sprint CEO Dan Hesse, Verizon Wireless CEO Dan Mead and AT&T President Ralph de la Vega are set to speak in a discussion moderated by CNBC’s Jim Cramer. T-Mobile CEO Phillip Humm was also set to be on the panel, but dropped out following AT&T’s announcement that it plans to buy T-Mobile USA for $39 billion.

Before the CEOs take the stage, though, there will be comments from FCC Chair Julius Genachowski.

Mobilized is here in Orlando and will have live coverage when Genachowski starts speaking in just a short while.

6:24 am: Still speaking is Sprint CEO Dan Hesse, acting in his capacity as Chairman of the CTIA.

6:28 am: Hesse has covered off on a laundry list of stuff from distracted driving, to the explosion of apps to recycling cell phones, to the role cell phone cameras have played in uprisings in the Middle East.

He’s finally wrapping up with a plea for the FCC to free up more wireless spectrum.

“Spectrum is also the oxygen that gives our industry life and growth,” he said. “But we are running out of oxygen.”

Genachowski takes the stage, reading his remarks off a tablet.

6:34 am: Genachowski addresses the elephant in the room: the AT&T-T-Mobile deal. Of course you will understand I am not going to comment on that.

6:35 am: He switches back to a popular topic in the crowd–freeing up more spectrum.

6:36 am: Surely it is just a matter of time before 5G will revolutionize the industry, Genachowski quips.

6:38 am: Genachowski is making the case that the mobile sector is critical to U.S. leadership and talking about the importance of the industry. But he’s preaching to the choir.

6:48 am: A lot of carbon dioxide being expended at CTIA talking about how spectrum is the industry’s oxygen.

Starting to wonder when we are going to get to the CEO panel. This keynote only scheduled to run until half past the next hour.

6:51 am: First potentially adversarial comments come as Genachowski extols virtues of open internet.

6:53 am: Now back to talking about spectrum. Everyone can breathe now. More oxygen.

Genachowski touts benefits of voluntary incentive auction where broadcasters and others get a piece of the revenue generated by auctioning off their spectrum.

“it’s the right idea at the right time.”

6:55 am: (Methinks wireless industry would prefer mandatory auctions and sooner rather than later.)

6:56 am: Voluntary incentive auctions could raise $30 billion, Genachowski says. “Not pocket change.” Costs of inaction exceed that, he adds.

6:58 am: Genachowski wraps up and hands off to CTIA president Steve Largent.

6:59 am: Largent mentions that NTT DoCoMo was planning to exhibit at CTIA but says they are understandably not here in wake of Japanese quake.

Largent encourages audience to text REDCROSS to 90999 to donate to relief effort.

7:01 am: Largent said he was on plane when he heard about AT&T-T-Mobile deal.

7:02 am: Jim Cramer introduces Ralph De La Vega and other panelists with a hearty “booya”

7:03 am: Cramer: Other than this weekend’s news, how did you like the play, Dan Hesse.

7:03 am: After joking about the elephant in the room, Cramer asks Hesse about the role cell phones have played in recent revolts in the Middle East.

“I think we are going to play a big role in social change,” Hesse said.

7:05 am: Is any government safe from power of tech, even China, Cramer asks.

“I think mobility creates democracy,” AT&T’s De La Vega. People around the world are speaking and it is our technology that lets it happen.

7:08 am: Cramer: What’s the next equivalent of text messaging — which was huge boom for the industry.

De La Vega says video communication is probably the next big wave. (Of course, video takes up a lot more capacity than texts)

7:09 am: Cramer: Why is my bill so high and why does he have to subsidize the people downloading so many movies.

Verizon’s Dan Mead: First of all, we appreciate your business. Mead says unlimited data plans have been key to fostering growth. However, the whole industry is looking at whether there should be caps or metered use like a water bill.

“It’s certainly an area of interest for the industry,” Mead said.

Hesse is asked if Sprint will have to shift. “Not necessarily,” he said. He notes that home internet is still unlimited, although there clearly is a difference, he said.

“Customers will actually pay a premium for simplicity,” Hesse said. “For now we are monitoring usage very closely” but we are maintaing unlimited.

7:11 am: Cramer asks De La Vega how much of the T-Mobile buy was about spectrum.

De La Vega says it was important, but doesn’t quantify, but notes it’s one of the reasons why the deal is “in the public interest.”

Cramer: Dan Hesse, Do you agree?

Hesse: “My opinion doesn’t matter. I think the FCC and DOJ will have the say on that.”

Notes that if the deal goes through 80 percent of power in two companies.

“i do have concerns that it would stifle innovation and too much power would be in the hands of just too,” he said.

Mead says Verizon is interested and will be observers, but notes that its company was built through acquisitions and that is how it got its spectrum position. “We’ll be watching what goes on here. There may be some things market by market that will be of interest. We are not going to be distracted by this.”

7:11 am: Cramer asks De La Vega how much of the T-Mobile buy was about spectrum.

De La Vega says it was important, but doesn’t quantify, but notes it’s one of the reasons why the deal is “in the public interest.”

Cramer: Dan Hesse, Do you agree?

Hesse: “My opinion doesn’t matter. I think the FCC and DOJ will have the say on that.”

Notes that if the deal goes through 80 percent of power in two companies.

“i do have concerns that it would stifle innovation and too much power would be in the hands of just too,” he said.

Mead says Verizon is interested and will be observers, but notes that its company was built through acquisitions and that is how it got its spectrum position. “We’ll be watching what goes on here. There may be some things market by market that will be of interest. We are not going to be distracted by this.”

7:15 am: Mead said Verizon never really looked at buying T-Mobile.

7:16 am: Cramer asks why his video freezes.

Hesse quips “Because you are on Verizon.”

7:23 am: Cramer: Has AT&T lost a significant number of customers with Verizon getting the iPhone.

De La Vega: Still hasn’t been a quarter. Can’t really comment, he says.

7:31 am: Cramer asks who is a friend and who is an enemy.

Panel lists Microsoft, Google, Twitter and Facebook as all friends, though Facebook could be a “frenemy” if it became its own carrier.

]]> http://allthingsd.com/20110322/live-att-verizon-and-sprint-face-off-at-ctia/feed/ 0 http://allthingsd.com/20110321/coming-up-live-att-talks-about-its-t-mobile-deal/ http://allthingsd.com/20110321/coming-up-live-att-talks-about-its-t-mobile-deal/#comments Mon, 21 Mar 2011 11:55:59 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5316 A day after AT&T’s surprise $39 billion deal to buy T-Mobile was announced, the company made its case to investors, regulators and the media on why the deal should go through.

The company positioned the deal as key to ensuring the U.S. stays competitive, saying that the country needs ubiquitous wireless broadband and has limited spectrum to get there.

As expected, there was also a lot of talk on how the deal will improve call quality and and about AT&T’s history of successfully digesting large acquisitions.

Also, check out our coverage from yesterday, including an interview with AT&T’s Ralph De La Vega, objections from Sprint and what AT&T will owe T-Mobile if regulators squelch the deal.

Live Blog

4:48 am: Mobilized is hoping that the government requires better hold music on all conference calls as a condition of allowing the deal to go through, should it allow the purchase. (Actually, the music today isn’t so bad as far as these things go. Mobilized just isn’t a morning person.)

4:56 am: AT&T clearly has its regulatory work set out for itself, with Sprint urging close scrutiny and at least a few lawmakers already calling for an inquiry.

4:57 am: Meanwhile, Business Insider notes that Sprint’s shares are taking a beating in pre-market trading, trading off around 12 percent.

Deutsche Telekom, T-Mobile USA’s owner, surged as investors cheered its strategy to unload the troubled North American carrier.

5:02 am: We’ve just been warned to silence cell phones and electronic devices. I’d love too, but of course, the cell phone is the very thing dialed in to the call.

5:05 am: Call now getting underway. AT&T chief executive officer Randall Stephenson is set to speak first.

“What I want to do over the next hour…” Well, there you go. That’s how long this will go.

Transaction represents a “unique opportunity,” Stephenson says, promising the deal will improve quality, enhance the spread of LTE and reward investors.

5:07 am: Stephenson positions deal as essential to protecting America’s leadership, saying that wireless broadband is key to national competitiveness.

He also points out that AT&T is the only major carrier that has a union workforce.

5:09 am: Now he is talking LTE, making the case that the merger will allow AT&T to spread the next-generation network further.

“As for the regulatory process, we’re very respectful,” Stephenson said. But, he said, now is the time for the deal.

“We can’t afford to wait.”

5:11 am: Capacity needs have grown and will grow another 8-10 times in the coming years, Stephenson said, pointing to growth of tablets, mobile video and other services.

“Every time we have increased speeds, usage has jumped,” Stephenson said.

5:13 am: Stephenson handing things over to the company’s general counsel to talk about the regulatory process.

5:14 am: Company is “very confident” it can achieve regulatory approval, the top lawyer says. He notes history of past mergers.

“We studied the law, we studied the facts,” he says.

Says company did its own rigorous internal review, expects regulators to do their own.

5:15 am: Says FCC will look at whether deal is in the public interest, while the DOJ will look at whether it benefits competition.

“We are confident we can meet these standards.”

5:16 am: General counsel notes spectrum challenges and the fact that T-Mobile had no clear path to a next-generation network on its own.

He also makes the “benefits U.S. competitiveness” argument. Sounds like this deal is being wrapped in the flag. “An American company investing billions of dollars in America,” he says.

5:19 am: On the competitiveness front, AT&T is touting not only competition from Sprint and Verizon, but also from prepaid and smaller competitors such as Leap Wireless and Metro PCS.

“These aggressive competitors are not sitting still,” AT&T’s top lawyer said.

AT&T’s general counsel Wayne Watts is wrapping up. Says expects thorough review and some conditions, but sees deal being approved after market-by-market analysis.

5:22 am: On to head of AT&T’s business solutions unit, who is outlining why wireless broadband is so critical to American industry.

5:23 am: Meanwhile, Sprint thought now would be a good time to introduce its Nexus S 4G phone and plans to bring Google Voice to all its CDMA phones. Mobilized will get to that in a sec, Sprint. We’re a little busy here.

5:25 am: Don’t like your cell service today? Well, this transaction is for you. Greater cell density and other benefits will improve service, exec promises.

5:28 am: Integration plan. First, combine companies’ 2G and 3G networks. Identify which cell sites to keep, make them dual-band to support T-Mobile and AT&T’s separate frequencies.

Second step will be to rationalize spectrum owned by two companies, which should free up spectrum for LTE.

5:31 am: Exec speaking now is John Stankey, head of business solutions unit, FYI.

5:33 am: Next up, Ralph De La Vega, president and CEO of AT&T Mobility and Consumer Markets. He notes that he personally has a lot of experience, having led deal 7 years ago between Cingular and AT&T Wireless.

5:34 am: Interesting balance between touting deal for investors and not spooking regulators and the public.

De La Vega did talk about higher ARPU–that’s average revenue per user. Investors like higher ARPU, but consumers have another term for it–higher prices.

5:38 am: Interesting point–”Retail store rationalization.” Just figured out another party that won’t like this deal: Mall owners.

5:39 am: On to CFO Richard Lindner, who is outlining some financial details.

There is a collar on AT&T’s share price, as well as further limit that Deutsche Telekom’s ownership in AT&T won’t drop below 5 percent.

Lindner reiterates company hopes to close deal in 12 months and will work with regulators promptly to try to reach that goal.

5:42 am: Back to touting investor benefits, such as higher margins and revenue over the long haul.

Again, this will be a fascinating balance for the company to strike as it tries to sell investors and regulators on the deal at the same time.

5:43 am: Expect $7 billion in integration expense and $2 billion in capital expenses, but will be offset as starting in third year of deal AT&T expects $3 billion per year in efficiencies.

5:45 am: Modest dilution over the first three years, Lindner said, with deal accretive after that, Lindner said.

5:47 am: Synergies in this deal should be even more than in Cingular-AT&T Wireless deal of seven years ago.

“We’ve done this before so we are confident in our ability to execute,” Lindner promises.

5:47 am: While dividends are up to the board, Lindner said there should be enough cash flow for merged company to continue dividend.

End of formal remarks and on to Q and A.

5:52 am: Company asked about change to companies’ plans before deal closes.

No change, AT&T says. LTE roll-out will continue as planned ahead of deal closing. However, companies will continue to be competitors.

5:53 am: Asked if they had a chance to pre-vet the deal with regulators, AT&T says no.

Has given heads-up calls and started dialogue, it says.

5:53 am: Asked what concessions it might be willing to offer, such as willingness to accept price caps or other consumer assurances.

AT&T says deal not just about going from 4 to 3 carriers, says regulators will look at local markets which are actually more competitive with regional carriers.

“That’s where you find lots of competitors,” Stephenson said.

“There will continue to be enormous competition.”

Says will have detailed conversations with staff at regulators, but too early for specifics on possible concessions. “I cannot now predict what other issues may arise.”

5:58 am: AT&T says it doesn’t plan to drop previously announced deal to acquire former MediaFlo spectrum from Qualcomm for nearly $2 billion.

“We want that spectrum. We need that spectrum.”

6:00 am: Also interesting: No T-Mobile presence on the conference call. Just AT&T talking about the deal.

6:04 am: Asked whether AT&T thinks it may have to shed subscribers on the order of 15 percent, as Verizon was forced to as condition of Alltel acquisition, Stephenson said his expectation is that no divestitures should be required. But, he said, “I don’t even want to get into that right now.”

6:10 am: Last question. On network synergies and capital spending relative to “uneven performance” of network in recent years. (I think that is a subtle reference to all the dropped calls and other complaints)

There’s a lot of variables more than just capital spending, AT&T said.

With that, the call ends with a final wrap-up from AT&T placing the flag back around the deal.

More Coverage

• AT&T Wraps Self in Flag, Says T-Mobile Deal Essential to U.S. Competitiveness
• The AT&Terminator: Rise of Ma Bell
• Sprint: AT&T’s T-Mobile Buy Would “Dramatically Alter” Market
• First Casualty of AT&T Deal: T-Mobile Drops From CTIA Panel
• What AT&T Owes T-Mobile if Deal Doesn’t Go Through
• T-Mobile USA: No, We’re Not Getting the iPhone Yet
• T-Mobile’s Memo to Staff on the AT&T Deal
• AT&T’s President on Why T-Mobile Deal Should Pass Muster and Won’t be a Customer Nightmare
• T-Mobile: We Were Totally Kidding About AT&T’s Crappy Network!
• AT&T Agrees to Acquire T-Mobile USA for $39 Billion

]]> http://allthingsd.com/20110321/coming-up-live-att-talks-about-its-t-mobile-deal/feed/ 0 http://allthingsd.com/20110320/what-att-owes-t-mobile-if-deal-doesnt-go-through/ http://allthingsd.com/20110320/what-att-owes-t-mobile-if-deal-doesnt-go-through/#comments Mon, 21 Mar 2011 00:41:50 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5286 If regulators squelch AT&T’s $39 billion bid to buy T-Mobile, the company will have more than just its frustrations to deal with.

As part of the deal, AT&T has agreed to pay T-Mobile $3 billion and promised valuable spectrum and a roaming agreement should the deal fail to garner approval.

“In the event the transaction does not receive regulatory approval satisfactory to AT&T and the transaction does not close, AT&T will be required to pay a breakup fee of $3 (billion), transfer to T-Mobile certain AWS spectrum that is not needed by AT&T for its initial LTE roll out, and provide a roaming agreement to T-Mobile on terms favorable to both parties,” the company said in a fact sheet posted on Sunday.

AT&T has said it thinks the deal should pass muster.

“Today when you look across the top 20 markets in the country, 18 of those markets have five or more competitors, and when you look across the entire country, the majority of the country’s markets have five or more competitors,” AT&T President and mobile unit CEO Ralph De La Vega told Mobilized on Sunday. “I think if the criteria that has been used in the past is used against this merger, I think the appropriate authorities will find there will still be plenty of competition left.”

However, not everyone is so convinced. Democratic Senator Jay Rockefeller of West Virginia on Sunday urged regulators to “leave no stone unturned” in their examination of the proposed merger.

“With every passing day, wireless services are becoming more and more important to the way we communicate,” Rockefeller said in a statement. “So it is absolutely essential that both the Department of Justice and the FCC leave no stone unturned in determining what the impact of this combination is on the American people.”

There are also some other interesting financial details in the deal. For example, AT&T has the right to increase the cash versus stock part of the deal by up to $4.2 billion. There is also a collar on the AT&T stock price used to determine that part of the deal, meaning that no matter what happens to the stock, the price of AT&T shares used to calculate the deal won’t be less than $26.0165 per share and no more than $30.2354.

The company also lays out its views on other deal-related matters in this question-and-answer document.

More Coverage

• AT&T Wraps Self in Flag, Says T-Mobile Deal Essential to U.S. Competitiveness
• The AT&Terminator: Rise of Ma Bell
• Sprint: AT&T’s T-Mobile Buy Would “Dramatically Alter” Market
• First Casualty of AT&T Deal: T-Mobile Drops From CTIA Panel
• What AT&T Owes T-Mobile if Deal Doesn’t Go Through
• T-Mobile USA: No, We’re Not Getting the iPhone Yet
• T-Mobile’s Memo to Staff on the AT&T Deal
• AT&T’s President on Why T-Mobile Deal Should Pass Muster and Won’t be a Customer Nightmare
• T-Mobile: We Were Totally Kidding About AT&T’s Crappy Network!
• AT&T Agrees to Acquire T-Mobile USA for $39 Billion

]]> http://allthingsd.com/20110320/what-att-owes-t-mobile-if-deal-doesnt-go-through/feed/ 0 http://allthingsd.com/20110320/atts-president-on-why-t-mobile-deal-should-pass-muster-and-wont-be-a-customer-nightmare/ http://allthingsd.com/20110320/atts-president-on-why-t-mobile-deal-should-pass-muster-and-wont-be-a-customer-nightmare/#comments Sun, 20 Mar 2011 20:31:38 +0000 Ina Fried http://mobilized.allthingsd.com/?p=5249 AT&T President Ralph De La Vega says that the company’s $39 billion plan to buy T-Mobile may be a shocker, but makes all the sense in the world.

In a brief interview on Sunday, De La Vega, also CEO of AT&T Mobility & Consumer Markets, told Mobilized the rationale for the deal, why it should gain regulatory approval and how the company will be able to digest such a large purchase without causing a nightmare for customers.

Here is an edited transcript of our conversation.

How did this deal come about and why does it make sense?

De La Vega: The first thing is, this deal alleviates the impending spectrum exhaust challenges that both companies face. By combining the spectrum holdings that we have, which are complementary, it really helps both companies.

Second, just like we did with the old AT&T Wireless merger, when we combine both networks what we are going to have is more network capacity and better quality as the density of the network grid increases.

In major urban areas, whether Washington, D.C., New York or San Francisco, by combining the networks we actually have a denser grid. We have more cell sites per grid, which allows us to have a better capacity in the network and better quality. It’s really going to be something that customers in both networks are going to notice.

The third point is that AT&T is going to commit to expand LTE to cover 95 percent of the U.S. population.

T-Mobile didn’t have a clear path to LTE, so their 34 million customers now get the advantage of having the greatest and latest technology available to them, whereas before that wasn’t clear. It also allows us to deliver that to 46.5 million more Americans than we have in our current plans. This is going to take LTE not just to major cities but to rural America.

You guys are already pretty big, already right up there with Verizon. How do you address any regulatory concerns that arise?

We are very respectful of the processes the Department of Justice and (other regulators) use.

The criteria that has been used in the past for mergers of this type is that the merger is looked at (for) the benefits it brings on a market-by-market basis and how it impacts competition.

Today, when you look across the top 20 markets in the country, 18 of those markets have five or more competitors, and when you look across the entire country, the majority of the country’s markets have five or more competitors. I think if the criteria that has been used in the past is used against this merger, I think the appropriate authorities will find there will still be plenty of competition left.

If you look at pricing as a key barometer of the competition in an industry, our industry despite all of the mergers that have taken place in the past, (has) actually reduced prices to customers 50 percent since 1999. Even when these mergers have been done in the past they have always benefited the customers and we think they will benefit again.

The other big concern with any merger is that you become busy with integration issues. Obviously this is a fast moving industry. How do you make sure that you guys are still doing what you need to do, rolling out the latest stuff, while you are handling a merger of this size?

I did this before when I combined the old AT&T Wireless with Cingular Wireless. I was the chief operating officer for Cingular.

Within three years we had reduced the churn rate in half and we had improved margins by 1,000 basis points. At the time of the merger, back in 2004, they said that we would lose customers and we would be too busy doing the merger integration process. The first process out of the chute, we led the U.S. industry in total net adds for that quarter, the fourth quarter of 2004. We have the same team. I am here and we are going to make sure this great AT&T team does exactly that again.

More Coverage

• AT&T Wraps Self in Flag, Says T-Mobile Deal Essential to U.S. Competitiveness
• The AT&Terminator: Rise of Ma Bell
• Sprint: AT&T’s T-Mobile Buy Would “Dramatically Alter” Market
• First Casualty of AT&T Deal: T-Mobile Drops From CTIA Panel
• What AT&T Owes T-Mobile if Deal Doesn’t Go Through
• T-Mobile USA: No, We’re Not Getting the iPhone Yet
• T-Mobile’s Memo to Staff on the AT&T Deal
• AT&T’s President on Why T-Mobile Deal Should Pass Muster and Won’t be a Customer Nightmare
• T-Mobile: We Were Totally Kidding About AT&T’s Crappy Network!
• AT&T Agrees to Acquire T-Mobile USA for $39 Billion

]]> http://allthingsd.com/20110320/atts-president-on-why-t-mobile-deal-should-pass-muster-and-wont-be-a-customer-nightmare/feed/ 0 http://allthingsd.com/20110105/att-and-friends-talk-up-4g-network-new-devices/ http://allthingsd.com/20110105/att-and-friends-talk-up-4g-network-new-devices/#comments Wed, 05 Jan 2011 17:35:33 +0000 Ina Fried http://mobilized.allthingsd.com/?p=1786 AT&T said on Wednesday that it plans to speed up development of its next-generation cellular network, completing the LTE network by the end of 2013.

Speaking at the Consumer Electronics Show, AT&T executive Ralph de la Vega said that the company plans to release 20 4G devices this year both for the LTE network and for its current HSPA+ network.

De La Vega said just after that that the company will have devices on the Apple, Android, BlackBerry and Windows Phone 7 operating systems. (Update: 12:12 p.m.: While some in the audience, including Mobilized, heard an implication that there would be a 4G iPhone, an AT&T representative said De La Vega was only saying that the iPhone would be part of AT&T’s smartphone lineup and not suggesting a 4G version.)

Among the devices that will be on AT&T’s HSPA+ network is the Motorola Atrix 4G, a dual-core-powered Android phone from Motorola. The phone, which also packs 1GB of RAM, was launched by Sanjay Jha, CEO of newly split-off Motorola Mobility. one of the more interesting features is the phone’s optional “lap dock,” which allows the phone to power a small laptop capable of running a desktop version of the Firefox browser, among other programs.

AT&T will also have a new phone from HTC that will include a new version of the company’s Sense user interface and also connect to a new HTCSense.com Web portal.

“HTCSense.com makes your smartphone even smarter,” HTC CEO Peter Chou said, demonstrating a feature that lets you ring your phone when it is lost in the house or send a lost-and-found message to appear on a phone you left in a cab.

By building both HSPA+ and LTE networks, De la Vega said that the company will offer more speed and flexibility.

“More importantly, we will deliver an experience our competitors will not be able to match,” De la Vega said.

]]> http://allthingsd.com/20110105/att-and-friends-talk-up-4g-network-new-devices/feed/ 0