With nearly all wireless carriers having reported second-quarter results, or at least filing an extension with the Securities and Exchange Commission, N. Moore Capital Ltd. released its quarterly carrier metric rankings that showed continued domination by nationwide carriers, which took the top three positions and seven of the top 10 spots.
The rankings cover 21 North American wireless operators and are based on five operational metrics: subscriber growth as measured by penetration gain, average revenue per user, customer churn, pre-interest expense free-cash-flow per subscriber per month and cost of acquisition. Carriers are ranked from first to 21st in each category with the lowest overall score taking the top prize.
Verizon Wireless again found itself at the top of the rankings for the third straight quarter, with a low score of 30 points thanks to robust customer growth that resulted in a 1.8-percent annualized penetration gain, which N. Moore noted was triple the 0.6-percent median number posted by its sample group. Verizon Wireless also posted top 10 finishes in cost of acquisition, customer churn and piFCF/subscriber per month.
The only metric the carrier failed to crack the top 10 in was ARPU, which at $49.17 placed the carrier 12th among the other operators in the rankings.
Canadian wireless operator Telus Mobility placed a close second to Verizon Wireless, with 31 total points thanks to market leading 1.3-percent customer churn, a third-place finish in subscriber penetration gain, a fourth-place cost of acquisition ranking and seventh-place piFCF/subscriber per month. The only category Telus failed to place in the top 10 was in ARPU, where the carrier dropped to 16th out of the 21 carriers in the rankings.
“Nothing new to report here as Telus continues to be one of the best performing wireless operators in all of North America,” noted Jeffrey Hines, president of N. Moore Capital, in the report.
Following a first-place tie with Verizon Wireless in the first-quarter rankings, Nextel Communications Inc. dropped to third place during the second quarter with 33 total points. Nextel’s industry-leading ARPU, third-place piFCF/subscriber per month, and fourth-place subscriber growth and customer-churn results were not enough to offset a last-place finish in the cost-of-acquisition category.
While nationwide operators occupied the top three places in the rankings, Dobson Communications Corp. led all of the regional players with a solid 38 points for a fourth-place overall finish. The carrier posted industry-leading piFCF/subscriber per month, a third-best 1.6-percent customer churn and sixth-best subscriber growth during the second quarter, but it was held back from a higher placing due to its 11th-place cost of acquisition and 17th-best ARPU result.
Rounding out the top five was a robust 45-point showing by Cingular Wireless L.L.C., which catapulted from an 11th-place finish in N. Moore Capital’s first-quarter rankings to finish as the third-highest domestic nationwide carrier during the second quarter. Cingular’s best-ever finish in the rankings was backed by a third-place finish in cost of acquisition, eighth-place subscriber growth result and ninth-best piFCF/subscriber per month.
While the top five carriers were spread out over a 15-point gap, the next five placing were separated by a scant four points, including a three-way tie for sixth place between Sprint PCS, Canadian operator Bell Mobility and AT&T Wireless Services Inc.
Sprint PCS managed to scrap back into the ranking’s top 10 following four consecutive quarters hovering between 11th and 13th thanks to a third-place APRU and sixth-place piFCF/subscriber per month result. Bell Mobility, which tied fellow Canadian carrier Telus Mobility for third place in the first-quarter rankings, slipped a few spots despite second-place finishes in both subscriber growth and customer churn. AT&T Wireless made one of the largest quarterly jumps, leaping from a 14th-place finish in the first-quarter rankings to the three-way tie for sixth due to a fourth-place ARPU result and tenth-place finishes in subscriber growth, cost of acquisition and customer churn.
U.S. Cellular Corp. and Alltel Corp. rounded out the top 10 rankings with what N. Moore Capital noted were another set of consistent metrics including a fifth-place finish by U.S. Cellular in subscriber growth and a fourth-place finish by Alltel in piFCF/subscriber per month.
Overall, Hines noted the rankings sample group posted a 30-percent year-over-year increase in net subscriber additions, which was the first increase in eight quarters, a less than 1 percent year-over-year increase in ARPU, and a 2-percent improvement in CPGA in the second quarter of this year, compared with 2002 results.
