Mike Sievert became CEO of the new T-Mobile on May 1st, taking over from the bombastic John Legere. Legere led T-Mobile for seven years. During this time, T-Mobile transformed itself from a budget, second-tier carrier to market leader. Sievert has been with T-Mobile since 2012 with roles of CCO, CMO, COO, and President. He is known for masterminding the remarkable streak of ‘un-carrier’ initiatives over the years and will likely continue T-Mobile’s edgy and aggressive marketing moves. Sievert’s goals as he begins his CEO tenure include:
- Integrating two major carriers. No simple feat to integrate the #3 and #4 largest US carriers. T-Mobile acquired MetroPCS and quickly and successfully integrated the CDMA prepaid brand. Look for Sievert and team to attempt to do the same with Sprint—get Sprint subscribers onto the T-Mobile network as fast as possible.
- Roll out 600MHz as blanket coverage and continue to add thousands of Sprint’s 2.5GHz sites. Strategically add mmWave where it makes sense.
- Customer service initiatives will continue. T-Mobile has leading customer service ratings and the company believes this has been key to their success.
- Un-carrier tactics will continue. Sievert is less bombastic than Legere, as he refrains from calling Verizon and AT&T ‘Dumb and Dumber’, for example. And, he will not likely do taunting airplane skywriting over the Verizon HQ. However, look for Sievert to continue to drive industry ‘firsts’ with interesting plans, bundles, and promotions—remaining aggressive post TMO/S acquisition.
- T-Mobile is actively engaged in open RAN initiatives. However, the carrier does have major concerns and admits it is taking it careful and slow.
- Large B2B aspirations now that the carrier is not hampered by its network being behind AT&T and Verizon.
Results-wise, it was an admirable quarter for T-Mobile considering the mass store closings and limited roaming due to COVID-19 lockdowns. T-Mobile sold 8.9 millions phones and 1.2 million IoT devices, mainly hotspots. 5% of the base upgraded, the majority in the month of June after drastic slowdowns in April and part of May. With the merger, T-Mobile is selling about 35% more devices. This will give the carrier more buying power and a better ability to get exclusives and white labels. With over 250 million POPs covered by their 600MHz spectrum, look for the carrier to get more aggressive in the second half of 2020 to drive 5G sales. The carrier currently has nine 5G smartphones and expects to be selling 18 by YE2020.
The big brag this quarter comes from the news that T-Mobile is now larger than AT&T with 98.3 millions subscribers. Its smartphone base is now 65.1 million and growing. The carrier’s old Achilles Heal of high churn is now competitive with Verizon and AT&T as phone churn was near record lows of .8%.
The second half of 2020 will be interesting as all major carriers ramp up the fight for 5G subscribers. See here for a complete break-down of T-Mobiles second quarter.