For the first time, the nation's largest wireless provider is losing customers faster than it can replace them.
It's a major milestone for Verizon, which last week reported a net decline of 289,000 cellphone subscribers over the past four months.
Even though Verizon usually loses some cellular customers every quarter, it has historically signed enough new ones to be able to report growth in that part of its business. But recent months have seen hundreds of thousands of customers defect to competitors such as T-Mobile and Sprint, analysts say.
Things could have been even worse if Verizon hadn't reintroduced unlimited data plans in February, according to Verizon's earnings report. In the first six weeks of the year, Verizon lost nearly 400,000 wireless customers, according to its latest earnings report. But once the new plans became available, they helped blunt those losses by attracting about 110,000 new subscribers, Verizon said.
Verizon's reluctance to reinstate unlimited data and its sudden about-face this year reflect rising competition in the cellular industry that is forcing large incumbents to adapt. The telecom giant has long argued that consumers are willing to pay a premium for a quality wireless experience, in contrast to budget carriers such as Sprint.
Verizon's losses underscore the urgency with which the company must make that evolution as it seeks to diversify beyond its traditional role as a provider of connectivity, said Jeff Kagan, an independent telecom analyst.
"This change in the marketplace is a threat to both Verizon and AT&T," he said.
SundayMonday Business on 04/24/2017