CINCINNATI-Cincinnati Bell Wireless said it lost 15,000 subscribers during the third quarter as higher-than-expected postpaid customer churn of 3.68 percent offset a 16-percent year-over-year increase in gross customer additions. The carrier blamed the increased churn, which nearly doubled from the 1.87 percent the carrier posted during the third quarter of 2003, on network issues related to its transition from its legacy TDMA network to GSM as well as increased pricing on rate plans and handsets for existing customers. CBW added that it ended the third quarter with 479,000 total customers, including 136,000 subscribers on its GSM network.
Postpaid average revenue per user dropped 6 percent year-over-year to $55 during the third quarter while prepaid ARPU increased 4 percent to $19 during the quarter. CBW noted the drop in postpaid ARPU was due to customers migrating to lower ARPU plans offered during the third and fourth quarters of 2003 as well as lower roaming revenues.
Total wireless revenues increased 2 percent from $65.1 million during the third quarter of 2003 to $66.2 million this year due to increases in prepaid service revenue and equipment revenue offsetting lower postpaid service revenue. Operating income plunged from $19.1 million during the third quarter of 2003 to $100,000 this year, which CBW blamed on increases in depreciation and amortization, the write-off of certain TDMA assets, an increase in subscriber acquisition costs and a decline in postpaid service revenue.
CBW, which currently operates as an AT&T Wireless Services Inc. affiliate, announced during the third quarter an agreement with Cingular Wireless L.L.C. that CBW said would reduce roaming expenses and give the company the option to purchase AWS’ 19.9-percent stake in CBW at a “favorable” price.<p
