Click to Skip Ad
Closing in...

Go Apple or go home? T-Mobile continues to flounder without the iPhone

Zach Epstein
February 23rd, 2012 at 10:01 AM

T-Mobile USA on Thursday reported a rough holiday quarter during which the company lost a net 802,000 contract subscribers. In its earnings release, T-Mobile mentions Apple’s iPhone — a device is does not sell — a total of seven times, repeatedly blaming its poor fourth-quarter performance on the absence of Apple’s smartphone from its store shelves. “The sequential and year-on-year increase in customer losses is a result of intense competitive pressure from the launch of the iPhone 4S by three nationwide competitors in the fourth quarter of 2011,” the carrier said in its press release. Looking beyond the fourth quarter, however, T-Mobile said in a separate press release that it now has a “reinvigorated challenger strategy focused on making amazing 4G services affordable.” This doesn’t bode well — according to T-Mobile’s own statements, 4G networks and affordable service are the least of the carrier’s concerns. Read on for more.

T-Mobile USA CEO Phillip Humm made T-Mobile’s position very clear. “Not carrying the iPhone led to a significant increase in contract deactivations in the fourth quarter of 2011,” the chief executive said in a statement. In fact, the very first line of T-Mobile’s earnings release reads as follows: “Strong adjusted OIBDA and prepaid performance; contract business negatively impacted in the fourth quarter of 2011 by iPhone 4S launches by three nationwide competitors.”

In a separate release, however, Humm sang a different tune. “We want to be known for delivering the best value in wireless because of the advanced technology we deliver at an affordable price,” Humm said. “Over the next two years, we’re prioritizing and investing in initiatives designed to get T-Mobile back to growth in the years ahead — beginning with the transformation of our network.”

But wait. T-Mobile is already known as the most affordable nationwide carrier and the company just publicly stated — seven times — that the iPhone is the problem. Not 4G service and not the affordability of its plans. The iPhone. Shouldn’t the company be “prioritizing and investing in initiatives designed to get” the iPhone?

T-Mobile sat in limbo for the better part of the second half last year as AT&T’s acquisition bid took center stage. That plan failed. Miserably. T-Mobile was sent away from the table with some new spectrum and $4 billion in its pocket, but that $4 billion will only take the carrier so far.

Hate it though they may, Apple’s iPhone is a carrier’s best friend in the U.S. right now. Without it, they lose over 800,000 post-paid subscribers. With it, they activate 7.6 million smartphones in a single quarter. Sprint saw that, and while it will take some time for the carrier’s massive iPhone bet to pay off, Sprint was willing to bank $15.5 billion on Apple’s smartphones

T-Mobile might not be in a position to make a similar play for the iPhone, but from the look of things, the carrier would be well-served to devote as much time and resources as possible to adding Apple’s iPhone to its smartphone lineup.

Zach Epstein

Zach Epstein has worked in and around ICT for more than 15 years, first in marketing and business development with two private telcos, then as a writer and editor covering business news, consumer electronics and telecommunications. Zach’s work has been quoted by countless top news publications in the US and around the world. He was also recently named one of the world's top-10 “power mobile influencers” by Forbes, as well as one of Inc. Magazine's top-30 Internet of Things experts.

Popular News