T-Mobile Reports An Increase in U.S. Customers

It was announced on Thursday, November 10 that T-Mobile has been able to increase its number of U.S. customers during the last quarter. This is the first time that the company has been able to do so in over a year.

"A decline of 186,000 contract customers in the third quarter was offset by an increase in prepay customers of 312,000," Deutsche Telekom, T-Mobile's parent company, stated during an earnings report.

Deutsche Telekom seemed to be very surprised by the progress that T-Mobile had made. They said that T-Mobile had "reported somewhat more positive development than in past quarters."

Deutsche Telekom went on to say that, on average, T-Mobile brings in about $14 per customer in revenue. This is a 13 percent jump from this time last year. Although T-Mobile is the only carrier out of the four major U.S. carriers to not offer the iPhone, it reported that the number of its customers with smartphones has increased by 40 percent, reaching 10.1 million customers.

"The improvement in earnings was largely attributable to successful savings initiatives and new rate plans without subsidized handsets," Deutsche Telekom said.
So, the big question is whether or not these improvements will affect AT&T’s efforts to purchase T-Mobile. One of AT&T’s main points during a recent Department of Justice lawsuit was that T-Mobile is going downhill and can only be saved if a company like AT&T saves it.

In September, in response to the DOJ, AT&T said that different rivals like Sprint are unable to "explain how T-Mobile, the only major carrier to have actually lost subscribers in a robustly growing market, provides a unique competitive constraint on AT&T."

"For the past two years, T-Mobile has been losing customers despite growing demand, and, without the spectrum to deploy a 4G LTE network such as that deployed by the other carriers, there is no reason to expect a change in its undifferentiated competitive significance," AT&T continued.

There is also a major debate about if the AT&T and T-Mobile merger were to occur whether or not it would create or kill jobs. The Communication Workers of America put out a report on Tuesday that said that the merger would create thousands of job, and the Economic Policy Institute said that a merger between the two mobile carriers could create somewhere between 55,000 and 96,000 jobs over the next seven years. They did, however, mention that this would only occur if AT&T followed through on its promise to invest $8 billion into its infrastructure over the seven year period.

However, the director of the Center for Economics and Public Policy at the University of California at Irvine, David Neumark, said in a report released in August that "AT&T has actually told investors and the federal government that the merger would lead to reduced capital expenditures on net. If you take EPI's own logic and apply that net reduction in capital expenditures to the data, you predict fewer jobs, not more jobs."

Who knows what will happen? AT&T is clearly the stronger company, but it is also apparent that T-Mobile is taking steps towards being a much more successful mobile carrier. Who knows if T-Mobile has enough time to save themselves though? One successful quarter does not mean that they are necessarily heading in the right direction overall. We’ll just all have to wait and see how it goes.

Source: PCMag - T-Mobile Adds Customers as Battle Over AT&T Merger Continues

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Does 4G Really Mean Much of Anything Anymore?

4G is something that we hear wireless carriers talking about all the time these days. Everyone seems to be fighting to provide the best 4G coverage, and while they try to convince the public that their particular company is the best, they don’t seem to mind taking a few jabs at their competition.

The problem is that 4G honestly seems to have turned into a meaningless term. All four of the major U.S. wireless carriers claim that their faster wireless networks are “4G” networks, but really none of the networks actually meet the International Telecommunication Union’s standards for 4G.

Speed is the most important requirement for a network to be labeled as 4G. The ITU says that 4G is technology that downloads at a speed of 100Mbps on mobile devices or 1Gbps on fixed wireless connections. The technology that all four of the U.S. carriers utilizes just isn’t that fast.

Back when the industry moved from 2G to 3G there weren’t any issues. The criteria was clearly defined, so there was no mislabeling going on, and wireless service providers and device makers followed the criteria when labeling their devices.

When 4G started to come about, the ITU defined new requirements. The problem was that wireless operators have decided to ignore the specifications set down by the ITU and have attempted to push their own definition of 4G.

The fact that carriers are doing this and the ITU really hasn’t done anything to clear up the matter is really getting to some people. It’s honestly making everything very confusing for customers.

Dan Warren, the senior director of technology for the GSM Association, an industry group that represents the interests of mobile operators in more than 200 different countries, said, “The term 4G is basically meaningless. It's not a term that anyone could use with a straight face to refer to anything technical. It's a marketing term that means different things to different people."

Some people are arguing that a label is merely a label and nothing else, but Warren says that the standards that are set by the ITU are important for setting customers’ expectations.

"The people who suffer from this are the consumers, who are confused," he said. "The operators use this term interchangeably to refer to different technologies that are incompatible. Customers are confused because they think they can compare the networks like for like. But they can't."

So how close is the “4G” service that U.S. carriers are providing to the real 4G service that is defined by the ITU? Well, keep in mind that the ITU says that the download requirement for 4G is 100Mbps. Verizon claims that its LTE service offers an average download speed somewhere between 6Mbsp and 12Mbsp, and Sprint says that its network download speed comes in somewhere between 3Mbsp and 6Mbsp.

T-Mobile didn’t want to be left out of the 4G game. They were a little a late with their 3G coverage compared to their competitors, but they almost immediately began updating with advanced 3G technology called HSPA+. The upgrades made their service almost as fast as LTE and WiMax in terms of speed. Therefore, last summer T-Mobile began marketing their service as having “4G-like speeds.” By the fall the company dropped the “like” aspect and began referring to their network as a 4G network.

Now instead of stepping in and clarifying, the ITU sent out a press release in early December that simply said that it was okay for the U.S. carriers to call their networks 4G.

"It is recognized that [4G], while undefined, may also be applied to the forerunners of these technologies, LTE and WiMax, and to other evolved 3G technologies providing a substantial level of improvement in performance and capabilities with respect to the initial third-generation systems now deployed," the ITU said in the statement.

This just made everything even more confusing and complicated.

T-Mobile’s CTO Neville Ray justifies calling the company’s HSPA+ network “4G” because he says that it performs just as well or better than the networks that T-Mobile’s competitors are calling 4G.

"Sprint chose to call WiMax 4G first," he said. "And then they chose to charge their customers $10 more for the service, even if some customers aren't in an area where they can get WiMax coverage. So who is misleading customers?"

"Our service performs better than what they are offering," he went on to say. "And HSPA+ and the path this technology is on has the same ability to reach the definitions of 4G as much as LTE and WiMax do."

Warren continues to say that the misuse of the term 4G has just gone too far.
"T-Mobile wasn't the first to cross the line in how they used 4G," he said. "But let's just say it went the furthest. Verizon and Sprint each bent the definition, but T-Mobile stretched the most."

Verizon and Sprint are obviously just as guilty as T-Mobile, but standards experts are saying that those companies’ claims are a little more justifiable, since their technology is at least moving towards the direction of true ITU approved 4G standards.

"Never anywhere on the planet have I ever heard of any version of HSPA being referred to as 4G," said Perry LaForge, the founder, executive director, and chairman of the CDMA Development Group (CDG), a trade association that promotes the use of CDMA cellular technology around the world. "In general, the industry looked at LTE and WiMax as the two 4G approaches. And the ITU was going through the process. Then this marketing stuff cropped up."

Honestly, it’s really just all a big mess. If only the ITU had stepped in when carriers started making 4G claims that weren’t meeting 4G standards, then we wouldn’t be in this situation and there would be a lot less customer confusion.