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Wireless Wars Update

Thomas Paulson
Jul 29, 2022
Wireless Wars Update

  • As an update on our recent discussions around Wireless Wars – which we previewed last week T-Mobile reported a robust 560K high-speed internet fixed wireless access (FWA) net additions. T-Mobile CEO Mike Sievert declared, "Demand continues to build from dissatisfied suburban cable customers to underserved customers in smaller markets and rural areas. I am so excited to see our broadband business hit this pace, which puts us right on track to meet the multiyear ambitions we shared with you last year [for 8M+ subscribers]." Two-thirds of the adds are coming from suburban and urban environments, where they're switching from cable, and one-third is coming from rural, where T-Mobile is the only high-speed alternative.
  • The FWA offering also allows T-Mobile to sell a bundled service, including wireless, and that offer is resulting in accelerating post-paid account additions (+380K this quarter compared to +268K in 2Q21) with the uptake on the bundle being "really terrific." According to the company, customers are "coming in buying high-speed Internet and then going ahead and switching, including Magenta MAX. That's starting to work as a very successful cycle." In contrast, Verizon lost -92K accounts.
  • In addition, Sievert shared that revenue per user was increasing "reflect[ing] our differentiated strategy to unlock growth across smaller markets and rural areas." (These markets’ users rely more heavily on mobile broadband.) As such, we continue to expect T-Mobile to continue setting up new retail locations in these markets as it densifies its network.

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Thomas Paulson

Director of Research and Business Development, Placer.ai

Thomas Paulson spent 20 years as a Wall Street analyst and a member of asset management teams at AllianceBernstein and Cornerstone Capital, representing top-50 ownership positions including Target, Home Depot, Nike, Amazon, Google, and many more.

He brings consumer related expertise and knowledge of enterprises in retail, CPG, financial services, telecom, and entertainment.

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