Holiday Promotions Squeeze Verizon
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As the promotional war raged in the wireless industry, Verizon largely stayed out of the fray. But not anymore.
On Monday, the nation’s largest carrier — and sixth-largest advertiser — admitted the competitive pressures of the holiday season are eroding profits. “The company expects that the fourth-quarter impacts of its promotional offers, together with the strong customer volumes this quarter, will put short-term pressure on its wireless segment [earnings],” the company said in a filing.
Verizon did note an acceleration in subscriber upgrade to 4G plans and an uptick in its Edge installment plan. Yet as more subscribers gravitate toward discounted phone offerings it will lead to slimmer margins “in this highly competitive and promotion-filled fourth quarter,” the company noted.
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