Growth in the number of net new wireless phone subscribers returned to double-digit levels in 1998, when a 25% net gain expanded the subscriber base by 13.9 million people following two years of single-digit gains, according to the Cellular Telecommunications Industry Association (CTIA).
The total subscriber base grew to 69.2 million people from 1997's 55.3 million, the association said in announcing the results of its semiannual carrier survey.
Last year's gain followed 1997's net new subscriber increase of 9.9% to 11.3 million new users and 1996's net gain of 6.3%, the lowest on record (see chart).
Dataquest analyst Matt Hoffman attributed 1998's surge to growing competition between a growing number of carriers, and said, "The catalyst for the market taking off was PCS entrants giving consumers new options and the cellular incumbents' aggressive response."
The simplified Digital One Rate plan launched by incumbent carrier AT&T Wireless in response to aggressive Sprint PCS plans "was clearly the market driver in the second half," Hoffman stated. AT&T's plan spurred other incumbent carriers -- including Bell Atlantic and GTE -- to follow suit with their own versions.
Last year's gain was the largest since 1995's 18.8% net increase but well below 1994's 63% gain of 8.1 million net new subscribers, CTIA found.
1995's 18.8% net increase but well below 1994's 63% gain of 8.1 million net new subscribers, CTIA found.
For this year's survey, CTIA got responses from 2,869 of the 3,073 systems operating in the U.S. and estimated subscriber growth in non-responding systems.
Using this methodology, the association also determined that:
- 27% of all subscribers, or 18.3 million people, used a digital service in 1998, up 183.5% from the year-ago 6.5 million.
- And the average monthly phone bill fell 7.8% to $39.43.