Wednesday, January 19, 2011

T-Mobile Bets on HSPA+ as it Plans a Turn Around

T-Mobile USA will return to growth and become a leader in mobile data services, said company executives and Deutsche Telekom officials at an investor conference. The company will take a more aggressive marketing stance as it positions its HSPA+ network against LTE and WiMAX. It currently ranks as the fourth largest mobile operator in the U.S. Rene Obermann, Deutsche Telekom's CEO, expects T-Mobile USA will return to growth this year and increase its revenue by $3 billion by 2014.

T-Mobile's HSPA+ network is currently available in 100 major metropolitan areas across the U.S., reaching approximately 200 million people nationwide. It currently supports peak downlink rates of 21 Mbps and an upgrade to 42 Mbps will occur this year. The company enables it claim the "4G" moniker and compete against Verizon's LTE.

One example is the newly-announced, T-Mobile exclusive, Samsung Galaxy S 4G -- its first smartphone capable of delivering theoretical peak download speeds of up to 21 Mbps. The phone is powered by Android 2.2 (Froyo) and features a Super AMOLED touch screen display. T-Mobile calls it the "fastest smartphone running on America's largest 4G network."

Some other notes from the T-Mobile USA investor day:

  • The HSPA+ network will provide a cost-effective and technically-flexible path to LTE. When it is time to upgrade to LTE, T-Mobile USA's deployment will be driven by the need to increase capacity, not because it needs to boost end-user speed or increase coverage. In fact, the believes that peak downlink performance for HSPA+ will keep pace with or even exceed LTE downlink performance.

  • A test in Las Vegas, found its HSPA+ network performed comparably to Verizon's LTE.

  • T-Mobile expects that global deployments of HSPA+ will significantly outpace LTE for the next several years, leading to a stronger ecosystem for the technology.

  • Its aggressive, "4G" advertising campaign will continue.

  • The company will consider selling some of its non-strategic assets, including towers, to generate cash.

  • T-Mobile USA believes it has sufficient spectrum for the next few years. It will look to acquire more spectrum in the long-term, possibly 2014 or 2015, from auctions (700 MHz AWS) or from the secondary market. It might also look for partners.

  • Backhaul is competitive advantage for the company. It also nearly 75% of sites on fiber already and this number will climb to 87% by Q3.

  • Growth in the U.S. market will come mostly from mobile data.

  • T-Mobile's growth strategy calls for "affordable" data services, a focus on both consumers and business, and better customer support.

  • Its first 4G tablet is expected this Spring.

  • No comment on the selling the iPhone, instead it will "go big" with Android.

  • The company currently has 34 million subscribers.

  • T-Mobile USA expects to save $1 billion in operational costs through "process reinvention." This include Zero Waste (moving to eBills, reducing handset return rates), Self-Service Automation, Simplifying products, and Network Efficiencies (transitioning 100% to all-IP, roaming overbuilds).

A full-presentation is on the investor page of Deutsche Telekom's website.