T-Mobile CEO John Legere offered a peek into how the company will bring its Un-Carrier initiative into the cable broadband market if it gets the go-ahead to merge with Sprint.
Business Insider Intelligence
The combined company, New T-Mobile, plans to disrupt the current US in-home broadband market — dominated by Comcast, Charter, AT&T, and Verizon — by offering an alternative option: a low-priced 5G home internet service featuring fast speeds, self-installation, no annual service contract, and its Layer3 TV service.
T-Mobile plans to kick off its Home Internet service by using a 4G LTE router running its existing LTE network. After the merger, the router will be upgraded to include 2.5 GHz spectrum and 5G compatible hardware.
Why would New-T-Mobile expand beyond wireless?
- Increasing competition in a market other than wireless will help incentivize regulators to approve the T-Mobile-Sprint merger. New T-Mobile’s service will offer consumers options: Nearly one-third (29%) of US households either have no service or lack a second option for wired broadband service. That share jumps to over 61% in rural households. New T-Mobile’s entry could force legacy providers to expand their coverage areas to avoid the risk of losing existing customers who gain a second option and to capture ones without any option that might migrate to New T-Mobile.
- It’s an opportunity for new revenue streams and customers. New T-Mobile expects to add 9.5 million customers to its home broadband service by 2024. It will also offer services to over half of US households by 2024.
Here’s why the move will be a success.
- T-Mobile has already disrupted the US wireless market. T-Mobile’s Un-Carrier initiative — which began in 2013 and killed some of the features that consumers hate the most, most notably the long-term contract — helped it surpass Sprint as the third-largest US carrier by volume in 2015. Additionally, the initiative enabled T-Mobile to steal customers and service revenue from Verizon and AT&T. It also beat out its rivals on value, loyalty, and satisfaction in 2018 for the second year running, according toBusiness Insider Intelligence’s Telecom Competitive Edge Report (enterprise only).
- New T-Mobile can lure dissatisfied broadband customers. In 2018, US internet service providers as a whole saw overall customer satisfaction fall 3 percentage pointsYoY in 2018. The company can take what it learned from the US wireless market and apply it to this market to steal dissatisfied customers from Comcast, Charter, AT&T, and Verizon.
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