T-Mobile Could Keep Its Solid Postpaid Momentum Going

by Trefis Team
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T-Mobile (NASDAQ:TMUS) published its subscriber figures for the fourth quarter, noting that it added a total of  1.4 million postpaid subscribers, marking a Q4 record while adding 1 million postpaid phone customers – its best holiday quarter in four years. The full year figures were also encouraging, as total branded postpaid phone net additions accelerated to 3.1 million, meaning that the company likely led its rivals by a significant margin. While the carrier likely been benefiting from some equipment promotions and offers, it has also been doing a good job of retaining existing customers and expanding its reach, potentially allowing for longer-term gains.

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Expanding Store Count, Coverage

Over the last few years, T-Mobile has been expanding its retail presence and improving coverage. The company has a sizable amount of low-band spectrum, particularly in the 600 MHz spectrum bands, which allows it to improve its presence in rural and suburban areas in a relatively capital-efficient manner. As of November 2018, the company noted that its 600 MHz Extended Range LTE was active in more than 1,500 cities and towns. An increasing store count is also likely helping the company expand its penetration. While the company doesn’t regularly disclose its store figures, it opened about 1,500 new T-Mobile stores and 1,300 MetroPCS stores in 2017, with a total of 16,400 retail locations at the end of 2017.

Churn Is Trending Lower 

T-Mobile also appears to be doing a better job at retaining customers. Over Q4, T-Mobile’s branded postpaid phone churn stood at 0.99%, marking a decline of 19 basis points year-over-year. This is likely being driven by the company’s improving customer service as well as moves to bundle video services such as Netflix with family plans. In mid-2018, the carrier overhauled its customer service operations, giving customers a dedicated set of customer care representatives who offer quick phone support, without having to go through robotic assistance and push-button menus. This is likely to be helping customer satisfaction rates, effectively reducing attrition.

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