@CTIA: AT&T on a roll with new devices, apps and 'emerging' sector

LAS VEGAS—AT&T Mobility is on a roll—and it used its annual press event at CTIA Wireless 2010 Wednesday to tout its dominance in the smartphone market, and to show industry press and analysts its blueprint to continue to drive sales in wireless with feature-rich phones that will entice a new set of customers and plans for continued impressive gains in the emerging devices space.
The United States is now the epicenter of the smartphone boom, noted AT&T Mobility CEO Ralph de la Vega. Thirty-three percent of the world’s mobile broadband users are in the United States; there are estimated to be 50 million smartphone users in the U.S. in 2010, and AT&T has twice as many smartphone users as its next biggest competitor, Verizon Wireless. “We are seeing what others have yet to see by a year or more,” de la Vega said.
With a firm handle on the smartphone space, AT&T showed how it plans to drive the feature-rich phone space, giving these simpler, but yet still complex devices some of the features that make smartphones attractive. Building on its CES announcement to incorporate Qualcomm Inc.’s BREW platform on more quick-messaging phones, the carriers showed four new devices that will be the foundation of this category of devices: the Samsung Strive, the Samsung Sunburst, the Pantech Link and the Pantech Pursuit.
AT&T is adding threaded text messaging, group messaging for up to 10 people and embedded multimedia elements into these devices. The carrier also introduced the AT&T Address Book, which enables customers to store their contact list automatically in the cloud, and users can manage the list online. AT&T is rolling out the free service initially on the Strive but will follow with other devices.
In addition, AT&T is rolling out a picture application that enables users to move photos from their devices to an AT&T Locker, where they can be managed, edited and shared. The service costs 35 cents an upload or users can buy a bucket of 50 for $10 per month. NewBay Software is AT&T’s partner for the app.
AT&T also is rolling out a music application for people to buy, discover and play streaming radio on their devices for $7 per month in conjunction with PacketVideo.
AT&T is using QuickPlay for its Uverse Mobile application, which combines AT&T’s TV and PC offerings with a mobile component so people can program their DVRs from their handsets as well as watch TV shows on their mobiles.
Femtocell approach
AT&T is rolling out its femtocell offering in a market-by-market approach and sounded cautious about the service, noting none of the nationwide carriers have really had a successful approach to selling femtocell solutions today. Part of the problem with femtocells is carriers have to admit that coverage is lacking when they are trying to sell the solution to customers.
AT&T’s femtocell, built by Cisco, can connect up to 10 users in the home or office. The carrier is charging $150 for the device and $20 per month for unlimited voice.
Emerging devices
The operator seemed most upbeat about its emerging devices category, which it is operating as an entrepreneurial startup inside the corporate conglomerate, de la Vega said.
The carrier had 1 million devices on the market in the fourth quarter, after launching the unit in the fall of 2008, said Glenn Lurie, who runs the unit for AT&T.
Executives, who laughingly showcased a dog collar with an embedded device that can track Fido when he runs away, said there is no way to predict how big this market will be because applications and devices are only limited by human imagination. “This space is everything,” Lurie said—personal navigation devices, e-readers, picture frames, tablets, tracking devices, etc. He challenged the audience to find a consumer electronics product that wouldn’t be better with a wireless connection.
AT&T is using a flexible business model and as such, each one of its deals is a custom solution. When asked why a customer would pay $60 for a USB broadband connection when they can pay $30 a month for the Apple iPad, which comes with broadband access for $30 a month, executives pointed out that some devices are subsidized, and therefore carry a higher monthly cost, while others, like the iPad, will not be subsidized so operators can afford to charge less for monthly connectivity.