Investors Wary of AT&VoIP
by John Paczkowski
Posted on October 7, 2009 at 2:33 PM PT
A complete reversal of its earlier policy restricting Internet telephone services to Wi-Fi only, AT&T’s decision to allow iPhone owners to use such services on its 3G network has gone over well with consumers, and more importantly, with Apple.
“We are very happy that AT&T is now supporting VOIP applications,” said Apple (AAPL) spokeswoman Natalie Kerris. “We will be amending our developer agreements to get VOIP apps on the App Store and in customers’ hands as soon as possible.”
But the new policy hasn’t gone over well with AT&T investors. Shares in the company slipped on the news yesterday and they’re falling still further today. AT&T (T) is trading at $26.21 as I write, down more than two percent from its open. Why? Perhaps due to concerns that the carrier might take a revenue hit when iPhone owners who are using telephony services to make cheap calls switch to low-minute voice plans.
As JP Morgan analyst Mike McCormack notes, voice accounts for $50-$60 of the $95 in monthly revenue generated by the typical iPhone user. If the average user were to drop AT&T’s unlimited voice plan ($99.99/month) in favor of its cheapest ($39.99/month), the carrier could lose upward of 20 percent of voice revenue.
That’s an ugly drop. And while AT&T might offset it by raising its data plan rates, doing so would inevitably outrage customers who are already giving it hell for poor coverage and lousy call quality.
