MetroPCS Hints at LightSquared LTE Deal
MetroPCS Inc. (NYSE: PCS) didn't reveal the financials of its Long Term Evolution (LTE) deployment with its fourth-quarter earnings Thursday, but executives did hint that it could be one of the carriers partnering with LightSquared on roaming. (See MetroPCS Reports Q4.)
"Roger [Linquist, MetroPCS CEO] has been very clear we're supportive of what LightSquared is doing," CFO Braxton Carter said on a call with investors. "If there are opportunities for us to take advantage of 4G LTE build from a roaming standpoint then, yes, we would be very interested in that."
LightSquared announced it has reached deals with two U.S. wireless operators for its wholesale LTE networks, but hasn't said which ones. T-Mobile US Inc. and MetroPCS are the most likely candidates. (See LightSquared Tees Up $586M Loan Deal .)
MetroPCS has been moving along with its LTE plans but is limited in geographical reach, making a partnership with LightSquared more attractive. The carrier has completed its rollout to all its markets, save one, which COO Tom Keys said will launch soon. Metro also recently introduced the first LTE smartphone, the Samsung Electronics Co. Ltd. (Korea: SEC) Galaxy Indulge, and inked a deal with Mavenir Systems Inc. to develop voice-over-LTE. (See MetroPCS Intros First LTE Smartphone, MetroPCS Turns on LTE in Four More Markets and MetroPCS Taps Mavenir for LTE Messaging.)
Its 4G network may not be helping it sign up droves of new customers, however. It added 298,000 new customers in the fourth quarter, down from the 317,000 added in the same quarter last year.
Carter wouldn't go into monetary details for its LTE deployment, but noted that Metro never expected to switch on a significant number of subscribers overnight.
"Until two weeks ago, we only had one handset out there," he said. "It's not meaningful at this point to get specific about what we're seeing."
Light Reading Mobile caught up with MetroPCS SVP Ed Chao at last week's Mobile World Congress. See the video below for his updates on Metro's LTE deployment.
RIP Feature Phones
Along with its move to 4G, Metro is expecting a "smartphone tsunami" and is looking to clear out its feature-phone inventory to make room for it.
"We think that feature phones are dead," Keys said. "The future's all about the smartphone experience," particularly on Android.
To date, one third of Metro's subscriber base is purchasing or upgrading to smartphones, Keys added. He said that higher-end LTE handsets will carry higher subsidies, but he believes the increase in brand awareness among consumers will be the pay-off.
"We find that our customers do want attractive phones even at higher prices if they are truly world class," Linquist added. "Our job is to make sure as we build our lineup of phones, we really get to handsets that people would say are world-class phones. That to us in the short term is a more immediate challenge [than high subsidies]."
— Sarah Reedy, Senior Reporter, Light Reading Mobile