news

T-Mobile Future Hinges on iPhone, ‘Uncarrier’ Strategy

**Editor’s Note:

Click here

for our look back at how some of the biggest names in telecommunications performed financially in the most recent quarter.**

T-Mobile USA on Wednesday reported a profit drop of 46 percent in its first quarter when compared to Q1 2012 down from $200 million to $107 million. Revenue also fell by 7 percent, to $4.68 billion.

The Bellevue, Wash.-based carrier, America’s fourth-largest wireless operator, said it lost almost 200,000 contract customers (net). That was better than the half-million it lost in the previous quarter and the year-ago quarter. Churn fell to 1.9 percent the carrier’s best mark since Q2 2008.

T-Mobile last month announced its move to “uncarrier” status, offering devices for unsubsidized prices and eliminating contracts, becoming the first of the major wireless operators in the U.S. to do so. The carrier also started selling the iPhone for the first time less than two weeks after the first quarter came to a close. T-Mo says it has sold a half-million of Apple’s iconic device in less than a month.

T-Mobile has a lot of moving parts in its new uncarrier strategy, and trying to decipher some early success/failure signposts is made even more complicated in that its new pricing rolled out in the final month of the quarter and its 500,000 iPhone sales came after the quarterly books had closed, noted Yankee Group senior analyst Rich Karpinski, commenting specifically on a Tech Crunch article. “So … how do the tea leaves read? … Not bad. Still, it will take a quarter or two to see exactly how all the dials it has rotated  cheaper rates, less exposure to subsidies, greater emphasis on prepaid, higher network investment levels play out across the business.”

T-Mobile just last week sealed the deal on its merger with MetroPCS, the fifth-largest wireless operator, creating a company with 40 million subscribers.

Follow senior online managing editor @Craig_Galbraith on Twitter.


Leave a comment

Your email address will not be published. Required fields are marked *

The ID is: 86518