AT&T CEO Randall Stephenson — one of the most powerful individuals in the wireless industry and the boss of AT&T Mobility's Ralph de la Vega — spoke for over an hour this week and took questions as part of the Milken Institute's Global Conference 2012. Many of Stephenson's comments were rehashes of AT&T's usual talking points on the so-called spectrum crunch and the need for industry consolidation (along the lines of last year's failed T-Mobile acquisition), but a number of interesting quotes came out along the way.

Regarding the effect of the iPhone on AT&T's data network and the move from unlimited data to the tiered pricing that AT&T offers on its smartphones today, Stephenson said that he didn't regret offering the iPhone (and why would he?) but that he wishes that he had killed off the $30 all-you-can-eat plan earlier than he had:

You ask, do you ever look back and ask, do we wish we hadn't [launched the iPhone]? No. No, I never reflect on that. Should we have changed the pricing model sooner? Yes. I wish we had moved quicker to change the pricing model to make sure that people that were consuming the bandwidth were paying for the bandwidth. And so we had a model where the high-end users were being subsidized by the low-end users. We got that model straight — took a while to get that straight. But no, it has revolutionized our industry, and I don't regret it at all.

He goes on to say that in the absence of T-Mobile-style consolidation, there will be "nothing but upward pricing pressure" in the industry:

Make no mistake about it, if you don't find solutions like [acquiring T-Mobile USA], there is nothing but upward pricing pressure in this marketplace. And you're experiencing it and you're living through it today. Since the beginning of the year when that deal got killed, our data prices have gone up 30 percent. You want to upgrade to a smartphone? Every carrier in the industry now has put in place an upgrade fee to try to slow this down. Virtually every carrier is now throttling, meaning when you hit a certain threshold of usage in a given month, your speeds get scaled back to try to reduce the utilization of these networks.

And yet he's quick to note that despite the apparent spectrum crunch, he's managed to increase the company's profit margins throughout the entire smartphone revolution:

2006, before all this began, we were basically a zero data revenue company running at about 30, 32 percent margins. Today, we're a 20 billion dollar data revenue company and we're operating at 41, 42 percent margins. So, I mean, people ask me, do you worry about how much value Apple is extracting out of the equation or the handset makers, I say, no, as long as we're extracting value too. Would I like to have more of the value? Of course! Right? But it's been good for our industry.

Though the T-Mobile deal is most certainly dead, Stephenson is convinced that consolidation in the US wireless industry is inevitable — regardless of whether AT&T is involved or not — claiming that an increase in competition makes spectrum utilization less efficient: "Obviously, the more competitors you have, the less efficient the allocation of spectrum will be. It's just... that's mathematical," he noted. He also claimed that "there are much fewer numbers of competitors" in markets like South Korea, Europe, and Japan which led to a "more rational allocation of spectrum," but it's unclear where Stephenson got his information — the UK, for instance, has four major players while Japan and South Korea both have three, hardly "much fewer" than the four nationals in the US today.

The entire conversation — embedded below — is a fascinating listen for anyone interested in the future of wireless competition.