Competition will intensify in the U.S. telecom market heading into 2020 due to the launch of 5G services and the potential T-Mobile/Sprint merger
Wireless revenue rose 3.1% year-to-year to $58.4 billion among U.S. carriers covered in Technology Business Research Inc.’s (TBR) 1Q18 U.S. & Canada Mobile Operator Benchmark as higher equipment revenue spurred by the adoption of premium devices offset continuing service revenue declines. Increased adoption of premium devices is benefiting equipment revenue as devices such as the iPhone X have pushed the acceptable average selling price for smartphones to over $1,000. Verizon, AT&T and Sprint expect service revenue declines will gradually moderate in 2018 as the bulk of customers are now on unsubsidized service plans. However, service revenue will be negatively impacted by the new ASC 606 industry accounting standard as well as lower overage revenue stemming from the growing adoption of unlimited data plans.