Is Deutsche Telekom Ignoring T-Mobile USA While AT&T Deal Awaits Approval?

While we await Deutsche Telekom and T-Mobile USA’s second quarter numbers set to be released sometime tomorrow an article coming out of Bloomberg shows analyst concern that T-Mobile USA is being left behind by their parent company. T-Mobile USA is expected to see a net contract customer loss of close to 350,000 customers from last quarter according to UniCredit SpA analyst Thomas Friedrich. That would  bring their total contract losses from the last quarter of 2010 to more than 1 million leaving just 25.6 million contract customers on the network out of less than 33 million in total. T-Mobile USA has all but dropped their plans to build out an LTE network on top of their existing HSPA+ network in light of the March 20th deal to sell to AT&T.

The March 20th deal to sell T-Mobile USA to AT&T faces opposition from some U.S. lawmakers, who say the creation of the largest U.S. wireless operator would increase fees and stifle competition. T-Mobile, already losing customers because it doesn’t carry Apple Inc.’s iPhone, risks further defections after it dropped plans to build a faster network based on technology used by rivals including Verizon Wireless.

Furthermore, since the first quarter of 2011 Deutsche Telekom has placed T-Mobile USA as “discontinued operations” in its earnings report. While T-Mobile USA accounted for 26% of Deutsche Telekom revenue in 2010 there is concern from the Deutsche Telekom board that CEO Rene Obermann isn’t doing enough to ensure that T-Mobile USA remains competitive as the AT&T deal faces an uphill regulatory review. While T-Mobile stands to receive $3 billion in cash and over $3 billion more in spectrum from AT&T should the deal not receive approval there is a clear concern that T-Mobile isn’t doing enough to retain customers.

Still, with customers already wary of signing contracts amid unclear ownership of the brand, T-Mobile USA isn’t doing enough to retain them with popular devices and new marketing initiatives, said Courtney Munroe, an analyst at Framingham, Massachusetts-based IDC. -Mobile “is not as edgy as they used to be,” he said. “AT&T has been very aggressive. Verizon has done surprisingly well. Sprint arrested its downward spiral. They’ve gotten good devices. The competition has gotten very stiff.”

The median estimate for T-Mobile USA’s contract-customer losses during the second quarter was around 200,000 according to a survey of eight analysts. The bottom line remains that T-Mobile USA has lost the confidence of their Deutsche Telekom overlords which risks T-Mobile’s already precarious position as the AT&T deal continues the regulatory approval process.

Bloomberg

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  • Mprosper69

    Id rather have Google take over. At least we would know the Updates would be timely and the Android platform wouldn’t be so fragmented on so many different devices, AND GPS THAT FREAKIN WORKS!

    • IT Guy

      With all of the different Android devices out there now, I think the fragmentation is unavoidable. Not all of them can run the latest versions, and some don’t support various things.

      As for Google taking over T-Mobile, it probably wouldn’t turn out so well. (Ignoring the fact that they’ve expressed no interest in it)  It’d most likely be a disaster for Android’s progress. If they owned a carrier, they wouldn’t want to compete with themselves by selling Android devices for other carriers.

      • Setzer715

        I’m not sure how you think Google would compete with themselves?  They don’t really sell phones, other than the Nexus line which really isn’t a money maker for them, and Android AOSP is open source.  Anyone is allowed to grab it and make it what they want.  They don’t make money off that either.  They make money off advertisement and Apps.

    • Jcj1

      Talk to manufacturers about updates, T-Mobile just provides the network not the software

      • Judo khan

        This isn’t exactly true.  Phone manufacturer’s rely on internal testing from the various networks to provide feedback to make software improvements, but then it is the responsibility of the CARRIER to roll out those updates.  The phone manufacturers make the updates and then link to the carrier’s directly, to provide customer’s updates.  This is very common with android and blackberry phones.

    • Jcj1

      Talk to manufacturers about updates, T-Mobile just provides the network not the software

  • Mprosper69

    Id rather have Google take over. At least we would know the Updates would be timely and the Android platform wouldn’t be so fragmented on so many different devices, AND GPS THAT FREAKIN WORKS!

  • Youngt82

    Most likely this deal will go down and if so i just really hope that since AT&T will have T-Mobile’s spectrum and network added to it, that they will have all the hottest android phones, hopefully not as expensive as verizon and faster 4glte network:)

    • Judo Khan

      This deal will not “go down”, IF, the American government, including Congress, the FCC, the FTC and the president value the ideals of our great nation and people.  We don’t want prices to go up, and by eliminating one of the competitors, T-Mobile in this case, AT&T and Verizon, will quickly kill off Sprint and become a DUOPOLY.  They will reduce competition and gain a lot of power to put whatever prices they want.  The ironic thing is, Verizon is staying quiet on all of this because they secretly know this deal will benefit them 1000%!!!

  • LILMICKY3

    this article makes me sick to my stomach.. THE GERMANS dont care abt TMOBILE USA .. all they want is the money .. 

    • ItsMichaelNotMike

      Well you are right about “all they want is the money.” But isn’t that the reason we all get up every morning, to get the money?

      Everyone works to get the money, so that we can get the stuff that we want, including fancy phones.  :)

  • BWalker

    Well if they had an iPhone, they might actually retain customers, I myself like T-Mobile for it’s Customer Service, and billing rate plans…but HATE that they don’t have an iPhone, and I’m not about to buy one from Apple unlocked for 729 USD.

    • Jcj1969

      It all boils down to Apple not building one with the 1700 Mhz frequency. Without if the iPhone is a 2G only device on T-Mobile. So get on Apple not a forum!

      • Judo khan

        I don’t agree with yo uJcj1969;  Apple is price gouging prospective customers that happen to have T-Mobile as their service provider; this has been a problem for years.  The phone manufacturers and service providers need to get on the band wagon and stop making prices go up!  Apple doesn’t need to charge over $700 for a device that only costs them $150-200 to make.

  • wk

    I have been a loyal customer of T-Mobile for a long time, and lately the customer service has been the worst ever.What happens here?? We (my wife and I) have spoken to more idiots and gotten nothing solved or questions answered since the old days of AT&T. Regardless of the future for this company, the customer have to be provided with proper care, and if not death  is the solution.

  • Victor1293

    T-Mobile is a great wireless network. What the company need to understand that some people don’t want a contract. Even with this being said, people are still become new customers thanks to T-Mobile’s Best Plan Ever! I also agree with some of the people that have commented on this article T-Mobile need to improve it’s customer service.