T-Mobile continues to outpace rivals in stealing subscribers.  The company continues to grow phone subscribers at a rate 3x to 5x greater than Verizon, AT&T and Sprint.  Primarily aided by its ‘un-carrier’ initiatives such as binge-on, free music streaming, and free Netflix, T-Mobile has more than doubled in size over the past five years.  The company ended the quarter with 38m postpaid subs and 21m prepaid subs. 

During the quarter, 10.4m mobile devices were sold.  9.6m smartphones were sold during Q4, only Verizon sold more at ~10.7m.  YoY, smartphone sales were down 4% due to the much more rational promotional holiday period.   Postpaid Magenta channel (postpaid) sold 5.7m smartphones and prepaid MetroPCS channel sold 3.9m. 

Other hardware sales and marketing news from the quarter include:

• Top selling device of the quarter was the iPhone X, which sold over 1.5m in just November and December.   The iPhone 8 and 8+ 64GB were not too far behind.   
• There were some big volume devices within prepaid/MetroPCS including the ZTE Blade Z Max, a 6”, 4080mAh battery with fast charging, and fingerprint sensor unlock, which often sold at $119 during the quarter (regular price $179).  LG Stylo and Samsung J7 were also solid prepaid performers.  (For full model level sales data, see Counterpoint Model Sales Tracker & 4Q17 US Update reports)
• Churn fell another 10 basis points to 1.18%.  Churn has been helped with a more competitive network and other ‘un-carrier’ initiatives.
• Porting ratios continue to go in T-Mobile’s direction vs. Verizon & AT&T, 1.91 and 1.84 in Q4.  Sprint porting ratios have been lower but down both YoY and QoQ to 1.40. 
• Postpaid ARPU is stable at $46.97, a decline of 1%.  Dilution from promos such as targeting family plans in new segments (4 line for $100 and even 5 for $100) drove the decline.  Many believe that 2018 will be a more rationale year of promotions.  It has started as such, but look for challengers to keep extreme pressure on all. 
• Marketing promos during the quarter, like the other carriers, were smaller for TMO relative to 4Q16.  However, there are still compelling switching activities.  The most successful has been ‘Netflix on us’, which gives subs a free Netflix subscription.  This will be very ‘sticky’.
• T-Mobile continues to have the most diverse sales within the big 4.  The carrier promotes these $100 – $250 devices as "smartpicks".  Promos come and go often.

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Network update news:

• T-Mobile expects to launch 5G on par with Verizon and AT&T.  The company took incredible sub losses for years when it fell behind on LTE rollout, hoping HSPA+ would suffice.  Today, LTE stands at 322m POPs.  There are now 586 metro areas in 28 states with 600MHz coverage.  LG V30 was the first Band 71 device and 12 more will be launching in 2018. 
• 600MHz will continue its aggressive build-out as it will be the backbone for 5G rollout.  Like other US carriers, it is expecting handsets available 1H19.  Other network enhancements include driving GB LTE, massive MIMO in 2018, and LAA (License Assisted Access—ie, using carrier aggregation in the downlink combining LTE in licensed and unlicensed spectrum).  LAA is live in NYC and other major metros will be live 1H18.  Like Verizon and AT&T, TMO will also use mmWave in handsets.   
• 80% of voice calls were over VoLTE (voice over LTE).  This is allowing the company to transition spectrum currently used for 2G and 3G for LTE. 
• As 5G will need much more network density, TMO is rolling out 25k small cells in 2018.  Close to 18k small cells have been rolled out in 2017.

Other goals for T-Mobile:

• Added 2800 stores, 1500 T-Mobile stores and 1300 MetroPCS stores.  As the network has improved outside of the major metros, TMO has moved in more points of distribution to attack incumbents, where in the past, they have been weak. 
• Business accounts are estimated to be 2% – 3% of T-Mobile’s subscriber base.  Look for more ‘un-carrier’ initiatives to grow the business sector.  The company stated 20% of postpaid net adds were within the business sector—big opportunity.
• TMO’s video strategy is not like Verizon & AT&T, who have made multi-billion-dollar purchases.  TMO did just close on its small cable TV player, Layer3, but this is mainly for talent and technology.  Layer3 has a video compression technology which it states allows the company to send HD video at less than 4Mbps. 
• The company hints that more rational pricing will happen in 2018 and T-Mobile will “balance growth and profitability.”  This is true until one carrier makes a desperate move, and then things can go back to crazy promotional campaigns—quickly.  The company believes 2m-3m net adds is still an achievable goal, meaning TMO expects it will continue remain the top growing US carrier. 
• T-Mobile has been very clear and consistent they believe there will be consolidation within wireless and cable.  CEO Legere repeats the company is open to talks with US Cellular, Sprint, DISH, Charter, Comcast, etc.  “5G only takes away further the distinctions between wireless and wireline that have traditionally been in place.”