The State of Competition in the Mobile Telephone Industry

Washington, D.C. – The Federal Communications Commission (FCC) has released its Twelfth Annual Report to Congress on the state of competition in the mobile telephone – or Commercial Mobile Radio Services (CMRS) – industry. The FCC concluded that there is effective competition in the CMRS marketplace. The report demonstrates that U.S. consumers continue to experience significant benefits – including low prices, new technologies, improved service quality, and choice among providers – from competition in the CMRS marketplace.

The Twelfth Report introduces a new data source that allows for a significantly more granular and accurate analysis of mobile telephone service deployment and competition. The new data source is a set of maps that provide the detailed boundaries of the network coverage areas of every operational mobile telephone carrier in the United States. Using these maps, the FCC was able to estimate: (1) the percentage of the U.S. population covered by a certain number of providers, and (2) the percentage of the population covered by different types of network technologies based on census blocks, rather than counties. Because census blocks are much smaller than counties – there are eight million census blocks versus 3,200 counties in the United States – this enabled a significantly more accurate and granular assessment.

The analysis of this data shows the following:

• Approximately 280 million people, or 99.8 percent of the U.S. population, have one or more different operators offering mobile telephone service in the census blocks in which they live.
• More than 95 percent of the U.S. population lives in areas with at least three mobile telephone operators competing to offer service.
• More than half of the U.S. population lives in areas with at least five competing mobile telephone operators.
• Approximately 99.3 percent of the U.S. population living in rural counties, or 60.6 million people, have one or more different operators offering mobile telephone service in the census blocks within the rural counties in which they live.
• Approximately 82 percent of the U.S. population lives in census blocks with at least one mobile broadband provider offering service.

In addition, during 2006, the number of mobile telephone subscribers in the United States rose from 213 million to 241.8 million, increasing the nationwide penetration rate to approximately 80 percent. The average amount of minutes that subscribers spend using on their mobile devices increased from 708 minutes per month during the second half of 2005 to 714 minutes per month during the second half of 2006. In addition, the volume of text messaging traffic rose from 9.8 billion messages sent during December 2005 to 18.7 billon messages sent during December 2006. Revenue per minute, which can be used to measure the per-minute price of mobile telephone service, remained unchanged during 2006 at $0.07.

Top 20 Mobile Telephone Operators 2006 by Subscribers

Rank	Operator	Subscribers
1	AT&T/Cingular Wireless	60,962,000
2	Verizon Wireless	59,052,000
3	Sprint Nextel	52,175,000
4	T-Mobile	25,041,000
5	Alltel	11,824,000
6	US Cellular	5,815,000
7	MetroPCS	2,941,000
8	Leap	2,229,000
9	Dobson Comm.	1,667,000
10	SunCom	1,087,000
11	Centennial	1,059,000
12	Rural Cellular	706,000
13	iPCS	562,000
14	American Movil / Claro	554,000
15	Cincinnati Bell Wireless	528,000
16	Ntelos	367,000
17	SouthernLINC	300,000
18	Shenendoah Telecomm.	203,000
19	Pocket Comm.	175,000
20	Edge Wireless	172,000