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Report: T-Mobile overtakes Sprint in Q1 as No. 3 U.S. smartphone carrier


dkyeager
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http://www.fiercewireless.com/story/report-t-mobile-overtakes-sprint-q1-no-3-us-smartphone-carrier/2014-05-22

 

What I find interesting about this report is how apple dominates the top two carriers.

 

 

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This is just measuring smartphone additions in one quarter... Obviously T-Mobile is going to have higher numbers for a while with all of their special promotions. Their ETF promotion is allowing millions of people to buy new smartphones much earlier than they would be able/willing to without it. Since the promotion is insanely expensive (up to $350 per switcher), T-Mobile will not be able to offer it for an extended period of time, and their smartphone sales numbers will fall back in line with their subscriber numbers.

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This is just measuring smartphone additions in one quarter... Obviously T-Mobile is going to have higher numbers for a while with all of their special promotions. Their ETF promotion is allowing millions of people to buy new smartphones much earlier than they would be able/willing to without it. Since the promotion is insanely expensive (up to $350 per switcher), T-Mobile will not be able to offer it for an extended period of time, and their smartphone sales numbers will fall back in line with their subscriber numbers.

 

Yup another example of poor (and probably dishonest) reporting...

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Didn't sprint use tablets to skew their subscriber growth numbers? Maybe this is just an effort to show the numbers minus tablets? Either way, Sprint really does need to start adding subscribers or eventually they will be overtaken.

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Didn't sprint use tablets to skew their subscriber growth numbers? Maybe this is just an effort to show the numbers minus tablets? Either way, Sprint really does need to start adding subscribers or eventually they will be overtaken.

 Sprint was not alone in trying to use tablets to boost numbers.  I believe AT&T as well.

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This is some mighty fine click bait, y'all.

 

"T-Mobile US (NYSE:TMUS), along with its MetroPCS prepaid brand, surpassed Sprint (NYSE: S) and Sprint's MVNOs as the third-largest U.S. carrier in terms of smartphone volumes in the first quarter, according to a new research report."

 

The headline leads a reader to draw the conclusion that Sprint was passed over by TMO completely, and is now squarely in 4th place in the great carrier ePenis measuring contest.

 

At any rate, hopefully this lights a fire under Sprint/Softbank's ass and doubles down on the commitment to a speedy, efficient rollout.

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I'm pretty sure that all the carriers use tablets to increase their numbers. Verizon is huge with advertising their tablets here, much more so than Sprint or AT&T.

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This is just measuring smartphone additions in one quarter... Obviously T-Mobile is going to have higher numbers for a while with all of their special promotions. Their ETF promotion is allowing millions of people to buy new smartphones much earlier than they would be able/willing to without it. Since the promotion is insanely expensive (up to $350 per switcher), T-Mobile will not be able to offer it for an extended period of time, and their smartphone sales numbers will fall back in line with their subscriber numbers.

You realize it's not a promotion right?

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You realize it's not a promotion right?

I guess that depends on what your definition of promotion is. From T-Mobile's website on the ETF program

" Limited time offer; subject to change. At participating locations. Eligible device trade-in, new device purchase, qualifying credit, port-in from eligible carriers (incl. AT&T, Verizon, and Sprint), and qualifying postpaid service required. "

Limited time offer makes me think promotion.

 

Sent from my Nexus 7 using Tapatalk

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You realize it's not a promotion right?

How could it not be? It's simply not sustainable. They're doing it to boost their subscriber numbers despite the fact that it's destroying their margins. It's a strategy to make them more attractive as an acquisition target, period.
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How could it not be? It's simply not sustainable. They're doing it to boost their subscriber numbers despite the fact that it's destroying their margins. It's a strategy to make them more attractive as an acquisition target, period.

It would be more additive if you would explain why it is destroying their margins.

 

100 million in 1Q... to have more gross adds than all other carriers combined. There is a reason why other carriers knocked the program off.

 

As far as promotional, they have said it is not ending any time soon. Promotional was what Sprint and ATT were doing.

 

I am just baffled that you think that it is destroying the margins. Why do they need 50% margins? What margins do they need and why can't they offer this etf offer long term? Why do you think it costs them a lot of money?

 

The strategy is to add subscribers. Their goal is to maximize shareholder value. More subs do not make them more attractive... It's unattractive because it will cost Sprint more to bid on them if they decide to.

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It's extremely expensive... With the plan pricing they're offering, they're spending months and months of revenue to acquire each customer, customers that are under no obligation to stay with T-Mobile.

 

It's funny you ask why T-Mobile needs to maintain their margins and then mention shareholder value. The only reason it's adding shareholder value is because it's more attractive as a takeover target. The TMUS share price is being completely driven by the anticipation of acquisition.

 

The fact that it makes them more expensive to acquire is perfect evidence that it's making them a more attractive target. That's how the market works.

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It's extremely expensive... With the plan pricing they're offering, they're spending months and months of revenue to acquire each customer, customers that are under no obligation to stay with T-Mobile.

It's funny you ask why T-Mobile needs to maintain their margins and then mention shareholder value. The only reason it's adding shareholder value is because it's more attractive as a takeover target. The TMUS share price is being completely driven by the anticipation of acquisition.

The fact that it makes them more expensive to acquire is perfect evidence that it's making them a more attractive target. That's how the market works.

Among many other cons Sprint will be buying back a large portion of their old customer base back if they purchase T-Mobile. These new T-Mobile customers which are old Sprint customers will soon start seeing that service is not that great in areas outside the city and blame Sprint. This is a double edged sword for Sprint. Sprint should have done a better job educating their customers about NV and all its up and coming aspects and this wouldn't have happen.
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It would be more additive if you would explain why it is destroying their margins.

 

100 million in 1Q... to have more gross adds than all other carriers combined. There is a reason why other carriers knocked the program off.

 

As far as promotional, they have said it is not ending any time soon. Promotional was what Sprint and ATT were doing.

 

I am just baffled that you think that it is destroying the margins. Why do they need 50% margins? What margins do they need and why can't they offer this etf offer long term? Why do you think it costs them a lot of money?

 

The strategy is to add subscribers. Their goal is to maximize shareholder value. More subs do not make them more attractive... It's unattractive because it will cost Sprint more to bid on them if they decide to.

Just assume for a moment that every one of those 100 million adds to advantage of the $350 to switch. That would be 35 billion dollars. If you break it down to a yearly cost and assume that the average T-mo plan is $50 a month then t- mobile has spent the first seven months recouping the cost of gaining the customer. You still have to account for T-mo overhead. After its all said and done the first 10 months are probably a wash.

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