Leading wireless provider, AT&T, Inc. (T) in collaboration with FiLIP Technologies has launched a smart locator and phone in order to track kids. The device comes in the form of a colorful wearable watch for kids between the ages 5 and 11. Customers can purchase the watch from FiLIP for $199.99 starting Nov 22. To activate the carrier service customers would need to shell out $10 per month.
The product emphasizes AT&T's growth path beyond the conventional and saturated wireless market in the U.S. With innovative product offerings, the company is strengthening its foothold in diversified products, which secures its market value in a competitive U.S. telecommunication market.
Apart from tracking devices, AT&T is also expanding its presence in the home security technology market. In November, the company launched its home security and automation service package ??? Digital Life, in six additional markets. By the year-end, AT&T expects to take its Digital Life package across 50 markets.
In Apr 2013, AT&T unveiled its Digital Life package in 15 cities including Los Angeles, Chicago, San Francisco and Miami, among others. The product includes security cameras, thermostats and locks that can be controlled from phones and tablets. We believe that product diversification will enable AT&T to grow beyond its legacy market and drive revenues in the coming years.
The company stated that the market for home security services is significantly unaddressed as only 1% of U.S. households have an automated security system. As a result, the company sees financial opportunity in the $18 billion market for automated home security systems. AT&T has so far seen more success in this market compared to its peers thanks to its own technology in home security digital products and adequate marketing and promotional measures.
However, in its legacy business, AT&T is looking at opportunities to improve its growth profile through a number of strategic initiatives. The company plans to woo customers with early upgrades to smartphones and tablets every year. The program allows customers to get new phones without paying extra on down payment, activation fee, upgrade or financing fee. New and existing customers due for an upgrade can avail this offer.
The carrier has also begun to offer a new device upgrade service called AT&T Next that allows subscribers (both new and existing customers) to change their old smartphones or tablets every year without separate payment of any upgrade fee or down payment. The company’s Mobile Share plan is also gaining popularity and already has 16 million subscribers. Management intends to launch new high-tier plans in the coming quarters.
AT&T, which operates with Verizon Communications Inc. (VZ), Sprint Corporation (S) and United States Cellular Corporation (USM) has a Zacks Rank #3 (Hold).
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