Summary:

Wireless carriers like AT&T (NYSE: T) are adding more new customers through tablet sales than smartphones, according to a new report.

Cheta…

Apple iPad
photo: Apple

Wireless carriers like AT&T (NYSE: T) are adding more new customers through tablet sales than smartphones, according to a new report.

Chetan Sharma’s report makes clear what was already pretty well known: interest in tablets, e-readers and other so-called “connected devices,” is growing each quarter and is even outpacing growth in smartphones, the darling of the mobile community the last several years. While it’s often easy for a new product to grow faster than a more established one, AT&T added more new customers in the fourth quarter because of tablet sales compared to smartphone sales for the fifth straight quarter, according to Sharma’s report.

And most of that is on the back of a single device: the iPad. Connected devices now make up 10 percent of AT&T’s subscription base, slightly more than the 9 percent connected-device share among Verizon’s subscribers. Apple (NSDQ: AAPL) has a distinct advantage over the competition when it comes to distribution, Sharma wrote: it doesn’t have to depend on carriers to sell its tablets, with a huge network of stores and retail partners giving it more control.

Competition is heating up with the release of Google’s Honeycomb Android software, the first version of Android designed specifically for tablets. But devices like Motorola’s Xoom are just now hitting the market, whereas Apple is expected to introduce its second-generation iPad Wednesday in San Francisco. “We expect iPad to dominate the space in 2011 as competitors will find it hard to compete across all dimensions – price, performance, ecosystem, distribution, and brand power,” Sharma wrote.

Lest anyone think the smartphone era is over already, Sharma notes that 48 percent of all phones sold in the U.S. during the fourth quarter were smartphones, as opposed to 25 percent of phones sold internationally. And those smartphones are chewing through a lot more data, up 132 percent in 2010 as compared to the previous year.

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