Year-over-year, it looks like AT&T can say that it finished this year on the profit side as compared to fourth quarter 2012 loses. The company recently posted a fourth quarter 2013 profit of $6.9 billion. Stock-wise, this relates to $1.31 a share.

Last year, AT&T reported a $3.9 billion loss which was seen as 68 cents a share. One year later AT&T is reporting a per-share earnings that amounted to 53 cents. This figure is excluding one-time items, including gains from its benefit plans.

This is on par with what Thomson Reuters analysts projected which was 50 cents a share with revenue of $33.1 billion. The actual revenue rose 1.8 percent to $33.2 billion. AT&T's wireless service revenue grew 4.8 percent to $18.4 billion, while on the wireline side, the company added 630,000 U-Verse Internet customers and 194,000 U-Verse TV customers.

One thing that is interesting is that there seems to be a subtle, but noticeable change in how AT&T is reporting its numbers. Those numbers show that the company added a net 566,000 wireless contract subscribers and 440,000 tablets. It also added 1.2 million smartphones under contract.

What is interesting about these figures is that they are not just new subscriber numbers. This total includes upgrades as well, basically creating a new metric. Normally when a company offers net numbers, it is a measure of how many new customers signed up for the service.

In addition, you subtract the customers who cancelled their service. It is not the norm to see a company include smartphone upgrades for existing customers. Part of this might be AT&T’s some of the stiff competition that it is seeing form T-Mobile.

To push the point, T-Mobile’s CEO, John Legere, crashed a party thrown by AT&T early this month at the Consumer Electronics Show. We have also seen that AT&T said that it would pay T-Mobile customers $200 to switch. If that isn’t enough incentive, AT&T will also credit up $250 for phones being traded in.

What would a competition be without a challenge? Shortly after AT&T’s announcement, T-Mobile made a counter of its own. It would pay up to $350 in early termination fees (ETF) to cover the cost of breaking a customer contract and switching services. T-Mobile also upped the ante by offering $300 per trade in smartphones.

AT&T proudly announced that last year’s turnover rate for its contract customer base fell to 1.11 percent. The previous year this number was 1.19 percent. AT&T did make mention of the fact of the more competitive environment that now exists.

Randall Stephensen, who is AT&T’s CEO, said, "There's no doubt the competition will remain strong. There's no doubt we'll continue to modify the value proposition." Along with the company chief financial officer, John Stevens, Stephensen mentioned that AT&T would change according to customer choice. It may not have been stated out loud, but we can make a good guess that the reference was to T-Mobile.

The feeling is that overall AT&T appears to be performing well on the smartphone side. Fourth quarter results verify this, however there is also the sense that AT&T is losing customers in the low end. I am referring to people who most likely still have a basic phone. These people are most likely veering toward T-Mobile’s aggressive offers.