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AT&T Wireless looks to buck trend

The company added 201,000 new subscribers during the last few months--about half what it expected--but it's faring better than rivals Sprint and Cingular, which have seen customer losses.

AT&T Wireless added 201,000 new subscribers during the last three months, about half of what it expected, the carrier announced Wednesday.

The company predicted 450,000 new customers this quarter, but instead suffered from what Chairman John Zeglis described Wednesday as the "WorldCom situation."

WorldCom had been selling AT&T Wireless service to 600,000 customers before it went bankrupt and closed its wireless business. AT&T Wireless courted all of the customers with AT&T plans, but only 300,000 signed up. The remaining consumers either had bad credit risks and weren't offered AT&T Wireless service or chose to go with other carriers, he said.

"The WorldCom situation is largely behind us," Zeglis told analysts on Wednesday. "Without the WorldCom hit, we could have grown customers in the half-million range, but then again, pigs would fly."

AT&T Wireless now has 20.1 million subscribers, an 18 percent increase from the previous quarter. It's on track to add 2 million new subscribers this year, the lower end of previous estimates for the year, Zeglis said.

WorldCom also resold Cingular Wireless service, but Cingular did not fare as well as AT&T Wireless. Cingular said this week it lost 107,000 customers in the last three months. It managed to sign up just a quarter of the WorldCom customers using Cingular's network to make calls.

Sprint PCS earlier this month said it lost customers because of a "higher than expected" decrease in the number of its Clear Pay program subscribers. Clear Pay targets low-income customers and sets a spending limit on phone calls.

Aside from subscriber total, AT&T Wireless also reported its financial results on Wednesday.

The Redmond, Wash., wireless provider recorded a net loss of $2.04 billion, or 76 cents a share, compared with a profit of $77 million, or three cents a share, in the same period last year

At the close of regular trading, AT&T Wireless shares were down 3 cents at $5.45 a share.