SOURCE: Five Star Equities

Five Star Equities

May 21, 2012 08:20 ET

Wireless Carriers Look to Chip Away at Costly Phone Subsidies

The Paragon Report Provides Stock Research on AT&T and Vodafone

NEW YORK, NY--(Marketwire - May 21, 2012) - Wireless carriers have begun to chip away at phone subsidies that mostly benefit phone makers like Apple. Carriers commonly pay full price for mobile phones and then sell them to customers who sign long-term contracts at a deep discount. The recent moves by wireless carriers to increase profits have been garnering applause from analysts. Five Star Equities examines the outlook for companies in the Wireless Services Industry and provides equity research on AT&T Inc. (NYSE: T) and Vodafone Group Plc (NASDAQ: VOD).

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"Optimism has increased that we are witnessing the leading edge of a more disciplined, and more profitable, future," Craig Moffett, a telecom analyst at Bernstein Research, wrote in a recent research note. The question now, he wrote, is how much profits can increase for companies as a result of "increased discipline and pricing power."

U.S. carriers have been increasing fees in attempts to discourage customers from upgrading to new phones. According to a recent article in the Wall Street Journal Verizon last month charged a $30 upgrade fee to some customers, and both AT&T and Sprint recently have doubled upgrade fees to $36. "It will have a meaningful impact on us in managing those handset costs," AT&T CFO John Stephens said on a conference call with analysts last month.

Five Star Equities releases regular market updates on the Wireless Services Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous stock reports and industry newsletters.

AT&T recently announced plans for a new portfolio of all-digital, IP-based home security monitoring and automation services. Called AT&T Digital Life, the services will give users unparalleled control and security of their homes using any web-enabled device, PCs, tablets and smartphones, regardless of wireless carrier.

Vodafone Group Plc is a mobile communications company operating across the globe providing a range of communications services. It offers a range of products and services, including voice, messaging, data and fixed-line solutions and devices to assist customers in meeting their total communications needs. It has a global presence, with equity interests in over 30 countries and over 40 partner markets worldwide.

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