Merrill Lynch gives estimates on carriers 1st Qtr 06

Motorola RAZR Still Dominating US Handset Sales

Merrill Lynch has carried out another of its interesting shop visits, taking in 80 stores in 4 USA regions. Following their store visits, they are maintaining their own estimates for handset sales, which do tend to be about 10% above industry expectations. Both Verizon Wireless and Sprint Nextel are expected to add 1.6 million customers each in Q1, with Cingular picking up 1.2 million and T-Mobile around 950,000 new customers.

In the store front, independent shop staff are not looking forward to yet another major rebranding exercise, probably next year as Cingular changes to AT&T. They are just recovering from the Sprint Nextel rebranding program, and it wasn't that long ago that the Cingular brand name itself was rolled out nationwide. Sprint Nextel store staff are also said to be frustrated as post-merger expectations did not materialise. They are said to be optimistic though about the shortly to be launched dual mode handsets which can work on both CDMA and iDEN networks and should give them a unique product in the retail market.

Both Cingular and T-Mobile may have been impacted by the Motorola RAZR handset recall earlier this month, although this is expected to be minimal.

Overall, Merrill Lynch is maintaining their industry estimates for 2006. They estimate that subscriber growth will slow in US wireless, from 25.5 million net additions in 2005 to 21 million in 2006, for an ending subscriber growth rate of about 10% YoY and 76% penetration. For 2007, they also estimate US wireless industry net additions of approximately 18 million new customers, which translates into a market penetration rate of 81%.



During their first quarter store checks, at Cingular, ML says that they think the top sellers were the Motorola RAZR V3 (Silver, Black and Pink), Sony Ericsson Z520a, Motorola SLVR, Nokia 6102 and the LG C2000. Cingular also launched its first 3G phones, the LG CU320 and the Samsung ZX10 in the upgraded markets.

At Sprint, the top seller was the Samsung a900, aka "The Blade." Other popular choices were the Samsung a920, the LG PM-225, Sanyo PM-8300 and the Samsung a840.

At T-Mobile USA, the top seller was the Motorola RAZR V3 (Silver and Pink). The Motorola PEBL, Samsung t309, Samsung e365 and the Nokia 6101 are also popular selections.

At Verizon Wireless, they conclude that the top seller was the Motorola RAZR V3c (Grey and Pink). Other popular choices were the Motorola e815, LG 8100, Samsung a850, LG 5200 and the Samsung a850.

In conclusion - the report was very much "steady as it goes" with no operator making significant inroads leaps or problems and with growth mainly coming from prepaid and family plan contracts.


To see a chart of their expected sales for the quaters for each carrier and churn, go to this site:

http://www.cellular-news.com/story/16714.php

 

It's actually going to be a drop for Verizon after the last 2 Qtrs they had. I guess we will see in the next couple of weeks as they start releasing results if they are close or correct.