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T-Mobile Hopes Prepaid Restructuring Will Rekindle Growth

Mike Dano
5/3/2019
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The executive who has led T-Mobile's prepaid business for the past seven years acknowledged that the business has been suffering lately, but he said a new restructuring effort could rekindle growth within Metro by T-Mobile.

T-Mobile's Tom Keys, speaking on a conference call with the company's prepaid dealers, a recording of which was obtained by Light Reading, also said he is not being pushed out of the business but is leaving voluntarily.

"I did not get fired … nor am I running away," he said. "You need to know I pushed for this. This was not thrust upon me."

Keys explained that he's stepping away from his leadership position at Metro by T-Mobile -- T-Mobile's prepaid offering -- to allow more cooperation between T-Mobile's leadership team and the management team for Metro by T-Mobile. T-Mobile this week announced that Keys is turning over leadership of Metro by T-Mobile to T-Mobile retail chief Jon Freier, alongside T-Mobile's new chief marketing officer, Matt Staneff. Keys said he is retiring to spend more time with his family, but added that he will continue to work as an advisor focusing on the prepaid aspects of the T-Mobile-Sprint merger. He added that he isn't planning to move to another company.

Several Metro by T-Mobile dealers participating in the call expressed concern that the business has slowed down significantly in recent months. One unidentified dealer said April was his worst month ever.

Keys said the restructuring will likely help align T-Mobile's postpaid promotions with its Metro by T-Mobile offerings, but also said that Metro by T-Mobile is suffering from an industry-wide prepaid slowdown. Indeed, the analysts at Wall Street research firm Cowen recently wrote that prepaid sales across the US wireless industry grew at their slowest pace since 2015, and that the total number of prepaid customers in the US recently declined for the first time since 2014. Many in the space believe prepaid customers are increasingly moving to postpaid pricing plans.

Keys, for his part, was a top executive at MetroPCS when T-Mobile acquired the company in 2013. At that time, MetroPCS counted roughly 8 million customers across 15 cities covering 103 million potential customers. When T-Mobile rebranded the effort to "Metro by T-Mobile" late last year, the company disclosed that the offering counted fully 18 million customers with 10,000 branded retail locations covering a total of 323 million potential customers.

Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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