T-Mobile executives argued that the economic upheaval sparked by the pandemic might increase the number of customers the operator is ultimately able to steal from its rivals AT&T and Verizon.
"I expect that AT&T and Verizon customers will most certainly be looking to get out from under their high monthly bills in search of a better value, and it's likely there will also be an increase in churn from today's low levels," T-Mobile's new CEO Mike Sievert said Wednesday during the operator's quarterly conference call with analysts, in discussing the short- and long-term impact of COVID-19 on the operator's business. "These factors will likely mean more switching across the industry as things change, and we will be there."
The company is hurting due to COVID-19 and stay-at-home orders, along with the rest of the US wireless industry and the global economy. In its most recent quarter, T-Mobile reported 649,000 branded net customer additions, significantly down from the 1 million it reported in the same period a year ago.
Further, the operator said it now expects to add between 0 and 150,000 postpaid net customer additions in its current quarter – far lower than its expectations before the pandemic.
Nonetheless, Sievert said a possible economic recession might push customers onto T-Mobile's cheaper service plans. "People are going to be looking for value," he explained. "They might be asking if they've got the right carrier."
And that, he said, could ultimately end up adding additional customers to T-Mobile's overall growth plans. "Over the mid- and longterm, we perhaps feel even better than our deal model [formed via the Sprint merger] contemplated two years ago."
Part of Sievert's optimism is based on the 5G network that T-Mobile has pledged to build over the next few years. Thanks to its now-completed merger with Sprint, the operator said it commands an average of 55MHz of lowband spectrum and 264MHz of midband spectrum nationwide, which the operator said is nearly double that of AT&T and nearly three times that of Verizon.
And as for millimeter wave (mmWave) spectrum, T-Mobile said that it now owns 1,160MHz of mmWave spectrum nationwide, which it said is second only to Verizon.
And it's already working to put that spectrum to work. T-Mobile just weeks ago switched on 2.5GHz spectrum for 5G in Philadelphia, where it said customers are now recording peak speeds of 600Mbit/s. And just this week the operator reported that it turned on a three-layer 5G network in New York City – a network that combines operations in lowband, midband and highband, mmWave spectrum and has been touted as a model for the rest of the industry.
Finally, T-Mobile argued that the pandemic is not slowing its 5G buildout efforts. The company said it added 1,600 sites to its 5G footprint in the first quarter of 2020, and grew that number by 1,000 sites in April.
"We've hit the ground running," Sievert said, arguing that soon customers "are not going to have to choose between a better value and a better network."
However, during the operator's quarterly conference call, T-Mobile officials did not provide updates on any of the operator's long-term strategic plans. Executives did not offer any new information on T-Mobile's plans to launch fixed wireless service in a challenge to the nation's cable companies, nor did they mention any new TV plans. Light Reading reported this week that T-Mobile is preparing to launch a new streaming video service this summer.
However, the company did acknowledge that it has re-opened an undisclosed number of retail stores, following its move to close fully 80% of its retail stores during the COVID-19 outbreak.
"Things are starting to rebound," said T-Mobile's marketing chief Matt Staneff during the operator's call, in discussing the operator's retail situation. "Things are starting to turn a corner."
And Sievert reiterated that T-Mobile will work to integrate the Sprint and T-Mobile brands "later this summer."