T mobile an unstoppable force case

1. ______________________________________________________________________________T-Mobile
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T-Mobile: An Unstoppable Force
Sidra Siddiqui | Atif Siddiqui
2015
Its 12:00 am and John Legere,the CEO of T-Mobile, is still sitting in his home office with a pencil in his
hand, writing something and unable to sleep. His wife calls him to sleep and to take some rest but he
seems restless. He is unable to answer his own questions. He is worried about the future of T-Mobile.
He recalls how he got the opportunity to become the CEO of T-Mobile and how he struggled to bring the
company up with the support of his colleagues and employees. He changed the meaning of competition
by bringing in no contract plans, no switching cost and lower and fixed rate internet. How the ‘Un-
Carrier’ strategy became their competitive edge and their corporate culture became their strength. But
eventually other competitors followed and with limited spectrum and input availability, once again it
became hard to compete and struggle for the top.
He is unable to answer what should be the next step for his company? Even with all these good policies
and practices the question once again comes is how to eliminate the major problem of spectrum and
changing technology. How to stay ahead in this competitive Industry? How to differentiate?
With all these questions going through his mind, he opens up his email and starts writing:
Meeting: Next Thursday
Agenda: Analysis of ourenvironment and challengesand how to overcome and differentiate.
Ideas fromworkforce are welcome and to be submitted through my direct e-mail…..

2. ______________________________________________________________________________T-Mobile
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About the Company
COMPANY HISTORY:
T-Mobile USA also known as the “Un-carrier” resulted from a merger between two American cellular
companies in 1994. At the time when the industry was fragmented,a merger between Pacific
Northwestern and General Cellular created a new company called Western Wireless Corporation, the
predecessor of T-Mobile USA. In 1999, Western Wireless Corporation spun off VoiceStream Wireless
which experienced major growth in both customers and market value. VoiceStream gained worldwide
attention including the European giant Deutsche Telekom, a German telecommunications company.
Deutsche Telekom acquired VoiceStream Wireless in 2001 and rebranded it as T-Mobile USA 10
.
In 2012, T-Mobile restructured its organization and optimized its operations in order to better meet the
needs of its customers and to reposition itself. T-Mobile then merged with Metro PCS and went public in
2013 4
.
Today, it actively trades in New York Stock exchange under the ticker symbol TMUS. The parent
company Deutsche Telekom AG(OTCQX: "DTEGY") maintains 67% ownership as common stock of T-
Mobile US, Inc.9
This larger support from its parent has allowed T-Mobile to become one of the four
largest wireless carriers in United States serving over 55 million customers and annual revenues of $24.42
billion 5
.
BUSINESS MODEL AND RESOURCES:
T-Mobile US, Inc. has its headquarters located in Bellevue Washington, employing over 40,000
employees 5
. T-Mobile USA is a national provider of wireless voice, messaging, and data services in the
United States, Puerto Rico and the U.S. Virgin Islands under the T-Mobile, MetroPCS and GoSmart
Mobile brands. It also offers cellular phones, smart phones and others products from various big
manufacturers like Samsung, Nokia, Apple Inc., HTC, Sony and LG. Moreover, T-Mobile operates retail
wireless hotspots at airports and businesses across the country.
T-Mobile US, owns and operates its services on over 2000 Cellular towers within United States and
neighboring territories. Utilizing its towers T-Mobile provides coverage to most of United States and
parts of Puerto Rico, Canada,and Mexico. Its nationwide network reaches 96 percent of
Americans through its HSPA 3G/HSPA+ 4G/4G LTE coverage.
Ericsson and Nokia Siemens Networks works as T-Mobile’s primary infrastructure vendors for its LTE
network. They have installed LTE Release 10-capable equipment at approximately 37,000 cell sites
across T-Mobile's HSPA+ network footprint as part of the carrier's effort to increase signal quality and
improve network performance 6
.
T-Mobiles also expects to have approximately 55,000 equivalent cell sites in total, upon the completion of
migration of MetroPCS customers,including macro sites and certain distributed antenna system (“DAS”)
network nodes. In 2013 T-Mobile also purchased 10 MHz of Advanced Wireless Services (“AWS”)
spectrum from United States Cellular Corporation (“U.S. Cellular”) which covers a total of 32 million
people in 29 markets. T-Mobile expects to further enhance its portfolio of nationwide broadband
spectrum through spectrum transfers and purchases to enable the expansion of LTE coverage to new
markets5
.

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Exhibit: T-Mobile Cellular Tower Location 2
Exhibit: T-Mobile 3G/4G Coverage 3

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CURRENT STRUCTURE
As a subsidiary of Deutsche Telekom, T-Mobile has its own corporate governance, which is run by a
board of directors and its executive team, made up of a chief executive officer, chief operations officer
and chief financial officer.
Currently, T-Mobile is run by John J.Legere serving as Chief Executive Officer1
and Presidentof T-Mobile
US. Legere,has previously served as an executive capacity for competitor AT&T, Dell, Global Crossing,
and also serves on the CTIA Board of Directors. He was appointed as the CEO of T-Mobile US in
September 2012 and has since been identified for T-Mobile's approach to contract-free wireless service or
the "Un-carrier". Under his direction, T-Mobile employs J. Braxton Carter serving as the Chief Financial
Officer, and James C. Alling serving as the Chief Operating Officer.
CUSTOMERS AND DISTRIBUTION
T-Mobile markets its services and products through its own network of approximately 8,000 retail
locations, as well as through more than 62,000 third-party retail locations and online 5
. T-Mobile
generates revenue from three primary categories of customers: branded postpaid, branded prepaid and
wholesale. Its largest customer segment (about 70% of revenue) is postpaid subscribers. Prepaid
customers account for about a quarter of revenue and wholesale clients, roaming charges,and other
services generate the rest. Wholesale segment is the smallest which contains MVNO or resellers of T-
Mobile Service. T-Mobile currently partners with 24 wholesale partners. Among the largest of partners
are Wal-Mart Family Mobile, Straight Talk, Simple Mobile, P-Tel, etc.

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FINANCIALS
In 2013 T-Mobile reported about $24 billion in revenue, up nearly 25% from the prior year5
. The growth
was powered by a more than $3 billion increase in prepaid service revenues because of the inclusion of
MetroPCS results starting in May 2013 and a nearly $3 billion rise in equipment sales primarily on the
introduction of Apple products.
After multi-billion dollar impairment charges in both 2012 and 2011, the company reeked out a $35
million profit in 2013 with no impairment charges that year. Cash flow from operations was down slightly
in 2013 to $3.5 billion.
MISSION STATEMENT
Unlike most companies T mobile does not present their mission statement in a formal business way,
instead they state in a very informal and customer friendly way their reason for existence:
‘In a world full of busy and fragmented lives, we at T-Mobile USA,Inc., have this idea that wireless
communications can help. The value of our plans, the breadth of our coverage,the reliability of our
network, and the quality of our service are meant to do one thing: help you stick together with the people
who make your life come alive. That's why we're here 9
.’
INFLECTION POINT AND CURRENT STRATEGY
Evident from the Mission Statement, T- Mobile focuses and listens its customers. In 2012, Legere came
in as a new CEO and crafted a strategy of Un-carrier’ to support the mission statement. In March of 2013
T-Mobile launched the first phase of this ‘Un-carrier’ strategy5
. In this 1.0 phase T-Mobile was the first
one to introduced Simple Choice plans, which eliminated annual service contracts and provided
customers with affordable rate plans without the complexity of caps and overage charges. In the 2.0 and
3.0 phase T-Mobile allowed its customers to upgrade their handsets and reduced international calling
rates and roaming fees and data at no extra cost. In its 4.0 phase, T-Mobile offered reimbursement
of early termination fees when customers switched from other carriers. Moreover,with its latest Un-
carrier phase, T-Mobile has rolled out cheap and simple business plan targeted at small companies14
. T-
Mobile has also upgraded their network to LTE and is currently working to expand this LTE footprint.
Legere also changed the way the company expressed as “Core Values” to what he called “How We Play”.
He brought in a new vision and new vocabulary for the the company. Legere embraced the magenta color
as the ‘Un-carrier’ spirit and as the company’s official color, the company followed suit. T-Mobile has
continued to take its transformation as it continues to encourage its employees to be bold and themselves.
“The concept really was, from Day, not just to survive but to go all the way7.
-John Legere, CEO in an interview with LA Times

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COMPETITIVE ADVANTAGE
This 'Un-carrier' strategy has become their competitive advantage and it has led T-Mobile to become the
nation's fastest growing wireless company. As a result of this strategy T-Mobile share rose from $16.25 to
33.64 in the year of 2013, resulting in a return of 107% 8
. It also added 4.4 million new customers in
2013. Since 2012, T-Mobile has increased its customer count by 66 percent 13
owing to its successful
strategy and customer focus and its customer base is still increasing as more and more people are
switching to T-Mobile 8
.
STRENGHTS AND WEAKNESS:
T-Mobile has a very strong brand equity. Its family shared data plans and no annual contracts are its
strength combined with 4G LTE technology which is the most recent and advanced technology right now.
T-Mobile has been ranked the highest among major wireless carriers for retail-store satisfaction four years
consecutively and highest for wireless customer care two years consecutively10
. However its poor
network and coverage is T-Mobile’s major weakness as its customers often do complain about call drop
due to weak signal. T-Mobile customers also have to pay full price for the cell phones unlike the free
phone or low cost cell phone offers by its rivals.
CORPORATE CULTURE:
"We had to change this culture unbelievably to something that stands for who we are 7
."
- John Legere
John Legere, the current CEO of T-Mobile has successfully transformed the company’s idle and listless
corporate culture into a vibrant hotbed of innovation, by staying focused on purpose. With tangible
returns as well as emotional engagement, T-Mobile employees has been able to show their colors,
organizational pride and recognize opportunities. T-Mobile has not only used employee generated content
(EGC) to bring their brand to life but also values their opinion by having an open door policy. It
encourages its employees to be bold and be themselves. T-Mobile has also introduced social call-to-
action- #BeMegenta, to inspire its employees to have workplace related conversation in social media 11
.
All in all, T-Mobile has created a corporate culture where its employees feela part of the company, where
they are respected for their views and innovative ideas and ultimately make the customers happy.

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BEST PLACES TO WORK: T-MOBILE
-Interview with Eirk Johnson, Director of Customer service by Birmingham Business Journal
What makes your company's culture rock?
If there's one thingT-Mobile does with style andflair, it's fun. Our passionforour customers andour employees provides a spiritedenvironment
that is conducive to productivity, creativity and growth.
What song title best sums up your company's culture?
“Can't Hold Us" by Macklemore
Describe your corporate culture in five words or less:
Unrelenting, unrivaled and unstoppable.
What's your company's strategy for retaining its rock stars?
Aside from awesome benefits, T-Mobile is a reward-for-performancecompany. Our topperformers canenjoy heftymonthly bonuses, pick their
work schedules and earn trips to places like Hawaii, Las Vegas and Miami.
What's the one tip or best practice you would suggest for a company looking to create a better workplace?
The way they communicate – T-Mobile has an open-door policythroughout the organization. Our values and culture promote open, honest
dialogue, as well as direct conversations, and we provide many avenues for this dialogue to take place.
Describe your company's philosophy on human resources in 10 words or less:
HR exists to advocate employee satisfaction and fair business practices.
What would you say are the three coolest perks about working at your company?
1) 75 percent discount on phone plan, 2) Awesome benefits including tuition reimbursement and child care assistance. 3) Month ly bonus
program and recognition trips to places like Hawaii, Miami and Las Vegas.
What do you think your company does best in terms of creating a great workplace?
We're committedtorewardingthe people who achieveresults for our customers withbest-in-business benefits. Our products and services help
our customers balance all the important things in their lives, and our benefits do the same for our employees.
What's the hardest part about creating a great place to work?
It takes creative ideas, exceptional executionandconsistent followup to keep T-Mobile a great place to perform.Creatinga great place to work
is what we do and we love doing it!
What makes your company different?
While T-Mobile has grown over theyears,we clingto our entrepreneurial spirit. Individual employees canstill make a difference and they take
great pride in stepping up to the challenge. They delight in going the extra mile for our customers and peers.
What's something a company looking to create a great place to work should avoid?
It has to be an environment where employees feel included. Our diversity and teamwork make for an atmosphere where collaboration and
innovative ideas are valued. We're passionate about delighting customers, which starts with delighting our employees.
What can other companies can learn from your company's culture?
At T-Mobile, we put our frontlineemployees first because theycareforour customers andtouch their lives everyday. All other employees work
to support the frontline to make their jobs easier. If our employees are happy, we know our customers are also.
What's the biggest challenge for companies when it comes to retaining workers?
At T-Mobile, we knowthat employees are our most valuable asset. Wehavelearnedthat anycompanymust appreciate their employees, reward
them, recognize them but most of all LISTEN to them. If they don't, employees will go somewhere that does.
Our ideal job candidate is:
Unstoppable
One trait we don't want in a job candidate is:
Uncaring

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FUTURE CHALLENGES
T-Mobile has seen an attractive upside based on its recent ‘Un-Carrier’ Strategy 5
. The company itself
realizes that they have applied an untested tactic that no other competitor has done in the past. In the
recent corporate 10-K filings the company has laid out certain Risk Factors that may impact the business
or the industry in whole.
Data Usage:T-Mobile believes that the wireless spectrum are scarce and the regulations on use are stiff in
order to expand services. Based on industry trends, the customers’ average data usage will continue to rise
and therefore more spectrum is required to meet demand and new technologies.
Increased Competition: T-Mobile recognizes that they compete on customers based on service, device
offerings, and call quality/coverage. Due to continued saturation, the customer growth may not be as
positive or may even be negative. Competition may continue attract customers with new offerings and
lower prices.
Consolidation: Mergers and acquisition and other strategic alliances has resulted in larger competition
among limited customers. The 2 of the largest competitors hold significant customers, spectrum, and
other resources. T-Mobile understands that exclusive handset partnerships and access to roaming may
limit company’s quality and ability to grow.
Technology: T-Mobile has to take advantage of new technology changes or it can lose or fail to attract
new customers. The company is on its way to deploy the latest LE Release 10 to modernize its systems.
Strategy: Last but not least, T-Mobile has moved from contract based postpaid accounts to non-contract
month to month accounts. If the tactics are not compatible with the needs of customers then there are no
long term contracts or residual commitments. If the strategies are not useful to keep the churn down then
the company may lose customers exponentially with nothing to tie them to the company. Also certain
customers have up to 24 months of financing setup with T-Mobile. If these certain customers suffer
credit issues then the company may suffer from bad debt and significant write-offs.

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Telecommunications Industry
The Wireless Telecommunication Service Industry is a part of Telecommunication sector. According to
NACIS code 517210 this industry is defined as:
This industry comprisesestablishmentsengaged in operating and maintaining switching and transmission
facilities to provide communications via the airwaves. Establishments in this industry have spectrum
licenses and provide services using that spectrum, such as cellular phone services, paging services,
wireless Internet access, and wireless video services.2
INDUSTRY PRODUCTS AND ACTIVITIES:
o Providing cellular voice wireless network communication service for local, long-distance and
international calls
o Providing messaging services, such as short message services (SMS) and multimedia messaging
services (MMS)
o Providing broadband Internet access and wireless internet services and other non-messaging data
o Selling cell phones and other wireless devices
o Renting out wireless telecommunications equipment
o Wholesaling wireless infrastructure capacity to telecommunications resellers
o Providing machine-to-machine M2M connections for fleet management systems, smart grid
devices, vehicle tracking, home security systems, and other telematics services.
o Operating and maintaining of switching and transmission facilities
o Paging, advanced PCS services, and other services
EVOLUTION:
In 1939 Daniel Noble invented two-way FM mobile radio system. Afterwards, AT&T was the first to
launch its mobile telephone service commercially in 1946 in St. Louis, Missouri, at a frequency of 150
MHz.11
In 1947 it developed the concept of cellular telephony and during the 1950s AT&T and Motorola
and a few others continued their cellular technology R&D efforts. In 1958, invention of the integrated
circuit contributed considerably to the ability of making portable miniaturize mobile phones. In the 1960s,
the citizen band radio (CB) became popular among truck drivers and then in the 1970s, it became
widespread among the general public. Meanwhile, Motorola continued experimenting with mobile
communications and in 1973, Motorola’s vice president, Martin Cooper displayed the DynaTac,a 28-
ounce portable telephone, on the streets of New York City. It took 10 years for the Federal
Communications Commission to approve the mobile telephone and Motorola introduced it formally in
1983. Motorola’s first model called the DynaTAC 8000X, weighed nearly two pounds and cost $3995.
Since then, prices and weight have come down dramatically and wireless industry has continued to grow
at a breathtaking pace. Today, four major companies dominate the U.S market namely Verizon, AT&T,
Sprint and T-Mobile and covers more than 90% of the U.S population.7

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INDUSTRY OVERVIEW
The Wireless industry is an extremely important part of the U.S. economy and the largest sector of the
Telecommunications industry. The wireless telecommunication industry in the United States is valued at
an estimated 205 billion U.S. dollars, according to 2014 statistics.4
This Industry is greater than
publishing, agriculture, hotels and lodging, air transportation and motor vehicle manufacturing segments
and rivals with computer systems design services and oil and gas extraction industries. The U.S. wireless
telecommunications industry has seen huge growth since its inception having more than 90% of US
households wireless service users and approximately 336 million mobile wireless connections today.6
This industry directly or indirectly employs 3.8 million Americans, which is 2.6 % of all U.S
employment. U.S wireless industry is a highly competitive industry with these four big players generating
approximately 96% of the total revenue.3
MAJOR PLAYERS:
There are four major players in U.S wireless industry. These include AT&T, Sprint, T-Mobile, and
Verizon Wireless. They are facilities-based mobile wireless service providers, which means these
companies provide services primarily using their own network facilities. These companies are typically
described as “nationwide” and all of these four providers have a network that covers significant portion of
land area and population of the United States. All of these nationwide providers provide service directly
to consumers and businesses and also provide machine-to-machine (M2M) services.
1. AT&T
American Telephone and Telegraph Company (AT&T) was first established as a subsidiary of
Bell Telephone Company in 1885 which later on in 1988 acquired the Bell Company and became
independent. In 2005, SBC acquired AT&T Corp. and took the company's more well-known
name as AT&T Inc. Today, AT&T is an American multinational telecommunications corporation
which has its headquarters in Dallas, Texas. AT&T is the second largest provider of mobile
phone service and 20th-largest mobile telecom operator in the world.12
AT&T Subsidiaries:
o AT&T Corp.
o BellSouth
o Southern Bell
o AT&T Teleholdings
o Cricket Wireless
o Lusacell
KEY INFORMATION:12
Company Public
Key People Randall Stephenson Chairman and CEO
Products  Fixed Line
 Mobile telephony

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 Broadband
 Fixed line internet services
 Digital television
Revenue $132.447 billion (2014)
No. of employees 243,620 (2015)
2. VERIZON COMMUNICATIONS
Verizon Wireless is a wholly owned subsidiary of Verizon Communications which was founded
in 2000 as a result of merger between Bell Atlantic and GTE. Verizon Wireless is the largest
wireless telecommunication provider in U.S serving 123.5 million subscribers4
. Its headquarters
are in Basking Ridge, New Jersey. The company is one of two major U.S. carriers that
use CDMA2000 (Code Division Multiple Access). 13
Subsidiaries:
Verizon Wireless
Diamond State Telephone
New Jersey Bell
Bell of Pennsylvania
Verizon North
The Chesapeake and Potomac Telephone Company
Verizon California
Hughes Telematics[5]
Terremark
EdgeCast Networks[6]
International Computer Security Association[7]
CyberTrus
KEY INFORMATION:13
Company Public
Key People Lowell McAdam (chairman and CEO)
Products Fixed line and mobile telephony
Broadband and Fixed line internet services
Digital television and network services
Global internet protocol backbone network
Revenue $127,079 billion (2014) $81 billion (2013)
No. of employees 177,300 (2014)

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3. SPRINT
Sprint Corporation traces its origins to the Brown Telephone Company,which was founded to
deploy telephone service to the rural area around Abilene, KS. In 2005, it took the name Sprint
Nextel Corporation as a result of merger with Nextel. Soft Bank acquired Sprint Nextel
Corporation in 2013 for $21 billion and it has now 80% stake in the company. It is the third
largest wireless telecommunication company serving 55.9 million customers as of 2015. It has its
headquarters in Overland Park,Kansas.14
Subsidiaries:
Sprint Communications Inc.
Boost Mobile Inc.
Virgin Mobile USA L.P
KEY INFORMATION:14
Company type Public
Key People Marcelo Claure, CEO
Masayoshi Son, Chairman
Products Wireless communication
Internet services
Long distance
Revenue 35.493 billion (2013)
No. of employees 36000 (2014)
MARKET SHARE
Verizon and AT&T are market leaders in the U.S wireless industry. They both hold 34 percent share of
subscriptions in the United States. Verizon has the most wireless subscribers in the United States, with
the figure standing at 123.5 million customers as of the second quarter of 2014. AT&T competing with
Verizon has approximately 116 million customer followed by Sprint, with only 55 million customers.
Based on subscriptions, Sprint is the third largest wireless carrier, holding a 16 percent market share in
the second quarter of 2014. T-Mobile ranks fourth with only 1% behind sprint, having 15% market share.4

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Exhibit: Wireless Carriers Market Share
Exhibit: Wireless Carriers Market Share (%)
Q1 '12
• Verizon 34%
• Leap Wireless 2%
• AT&T 32%
• Metro PCS* 3%
• Sprint 17%
• US Cellular 2%
• T-Mobile 10%

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M2M CONNECTIONS:
Many industries such as healthcare, are transforming to use M2M networks to connect their various smart
devices and machines. Although M2M connection are found typically in the Enterprises space,more and
more providers are now launching services for the home market.
The research firm “Current Analysis” estimates that AT&T had approximately 14.7 million M2M
connections, Verizon Wireless had between 7 and 9 million connections, and both Sprint and T-Mobile
had 3.3 million connections. M2M has gained significant interest in the past few years as providers
continue to provide connectivity between devices, sensors,monitors, etc. and their networks.
INDUSTRY INPUT:
Mobile wireless service providers use a combination of inputs to provide mobile wireless services to their
customers. These include electromagnetic spectrum to transmit signals between base stations and end
users’ devices, as well as non-spectrum inputs such as cellular base stations and towers to carry
transmissions. Backhaul, is another additional input required for the provision of mobile service.
SPECTRUM:
The spectrum is the most important input in the provision of mobile wireless services,including mobile
broadband, as it affects existing service providers and potential entrant’s ability to expand capacity and
deploy new networks. Spectrum bands vary in their characteristics,use and deployment. Service
providers transmit their spectrum bands differently depending on the nature of the service, geography,
density, or other factors in their network build-out. Low-band Spectrum below 1 GHz has distinct
network transmission advantages over long distances, while also reaching deep into buildings and urban
canyons. Low-band spectrum is considered to be coverage spectrum. High-band Spectrum above 1 GHz
is more plentiful and possesses certain technical advantages allowing for the transmission of large
amounts of information. High-band spectrum is considered to be capacity spectrum. There is significantly
less low-band spectrum than high-band spectrum that is suitable and available for the provision of mobile
telephony/broadband services.5
The FCC has established policies to make spectrum available to existing mobile service providers and
potential new entrants through initial licensing, primarily by competitive bidding, and through secondary
market transactions. These auctions are open to any eligible entity that submits an application and
upfront payment, and is found to be a qualified bidder by the Commission.

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NON-SPECTRUM INPUT SEGMENTS:
1. Wireless Infrastructure:
Wireless infrastructure facilities hosting cellular base stations are a major input into the provision
of mobile wireless services. They include towers and other tall structures for macro sites, such as
lattice towers,guyed towers,monopoles, rooftops, water towers,and steeples. In addition to the
use of towers and other tall structures,wireless infrastructure also include distributed antenna
systems (DAS) and facilities for small cell technologies that are generally deployed to address
coverage and capacity issues indoors, in densely populated areas outdoors, and even
underground. A specialized communications tower industry has developed to provide and
manage support structures for the cell sites required by mobile wireless service providers by
leasing space to them. Independent tower operators own, operate and lease shared wireless
communications and broadcasting towers, manage other high structure sites (such as rooftops,
water towers) for property owners, and to a lesser extent, build and operate DAS networks and
small cell facilities for mobile service providers.5
2. Backhaul:
Backhaul facilities link a mobile wireless service provider’s cell sites to the mobile switching
centers that provide connections to the provider’s core network, the public switched telephone
network, or the Internet, carrying wireless voice and data traffic for routing and onward
transmission. Backhaul connections are an integral component of a wireless service provider’s
network, and the cost of backhaul is approximately 30 percent of the operating cost of providing
wireless service. Backhaul services are generally provided by incumbent local exchange carriers
(ILECs),competitive local exchange carriers (CLECs),competitive fiber and microwave
wholesalers, cable providers, and independent backhaul operators. In some areas,the vast
majority of existing wireless towers have fiber connections. High bandwidth fiber backhaul also
allows wireless service providers to rapidly deploy 4G LTE services, while a lack of fiber
backhaul can delay a provider’s LTE rollout.5

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COMPETINGFACTORS:
1. PRICING
Mobile service provider majorly competes over pricing. Lately, all of these major service
providers have made changes to the pricing of monthly postpaid and prepaid service plans in
order to compete. They have effectively cut the price of postpaid service for customers whose
data use was extensive. Both AT&T and Verizon have cut the monthly service fees on selected
data tiers. In addition some providers, including Verizon, T-Mobile and U.S. Cellular, have
reduced the price of postpaid service plans by increasing monthly data allowances on usage-based
data plans without increasing monthly service fees. Value of existing plans have also increased by
some providers using adding new features and including international text messaging and cloud
storage allowances.
Changes have also been made in traditional prepaid plans by wireless providers. Most have
shifted their plans from unlimited data pricing to tiered, usage-based data pricing coupled with
speed reductions after usage exceeds a monthly allowance for high-speed data.
2. COVERAGE:
Mobile wireless service providers differentiate themselves with the speeds,reliability, capabilities
and coverage of their mobile broadband networks. All of the four major wireless providers offer
national coverage,using their own facilities and roaming arrangements. Based on January 2014
Mosaik coverage data,Verizon Wireless and AT&T each covers over 79 percent of US road
miles and over 55 percent of U.S. land area,while Sprint covers less than 50 percent of US road
miles and T-Mobile covers less than 25 percent of US land area with mobile broadband.5
3. TECHNOLOGY:
Wireless service providers also differentiate their service offerings from those of rivals by
becoming the first to install a particular upgrade or new network technology. Providers have
upgraded and expanded their networks with technologies that enable faster data transfer speeds.
Almost all of the major mobile wireless providers now offer or plan to deploy LTE.
4. WIRELESS HANDSETS AND OTHER DEVICES:
In addition to competing on price and network quality, mobile wireless providers continue to
compete by offering consumers a variety of different mobile wireless devices with innovative
features. Major providers now offer a range of smartphones and tablets which are made by
different manufacturers and run different operating systems. However,some providers offer
certain devices only on postpaid plans. Mobile wireless providers also offer wireless data cards
and mobile Wi-Fi hotspots to consumers seeking mobile Internet connections for laptop
computers and other Wi-Fi enabled devices. Because such devices usually have similar
characteristics and functionality across equipment manufacturers,providers generally
differentiate their offerings of these products based on their availability on postpaid plans or
prepaid plans.

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THREAT OF NEW ENTRY:
1. REGULATORY:
The industry has several barriers to discourage new entry. Large capital investments required for
deployment of the networks are an obviously major barrier. FederalCommunications
Commission (FCC) offers limited number of licenses thus creating a regulatory barrier of
entry. New entrants have to merge or form alliances with licensed incumbent.
2. BRANDING:
The market incumbents have made large investments to establish their name brand which
discourages potential entrants due to the heavy costs of developing brand recognition and to
create reputation.
3. CONSOLIDATION:
The industry has continued to consolidate leaving just 4 large players and absorbing most of the
smaller regional players. Mergers and Acquisitions have been necessary to penetrate regions
where cellular spectrum have been limited. The need to reach a wider geographical footprint is
also spread fixed costs and to create economies of scale and necessity to have a nationwide
coverage. This has made it unprofitable for new entrants to come to market.
4. STRATEGIC DETTERANTS:
The firms of today have created naturalstrategic barriers to deter entry. Once the infrastructure
has been placed, the marginal costs are negligible compared to fixed costs. The incumbents are
able to turn on extra capacity with ease. Further investments into the 4G/LTE not only has a
purpose of providing better technology but also increase capacity within the available wider
spectrum.
DEMAND DRIVER:
Wireless penetration in US now exceeds 104%3
while Forty Five million Americans use their mobile
phones as primary internet device 8
. Demand for wireless services is driven by consumer income and
continuously innovating service offerings. The profitability of individual companies depends on
marketing and customer service. Large companies have advantages in marketing and in delivering a
comprehensive array of services nationally and also packages tailored to niche groups regionally.
SUPPLIER POWER:
The mobile data consumption has continued to rise and the lack of available spectrum has become a
major bottleneck. In the United States, the absence of a large base of uninterrupted spectrum has resulted
in efficiency challenges for carriers launching 4G networks. Mobile carriers are taking a number of steps
to meet their capacity needs today, aside from mergers and acquisitions and network sharing alliances. A
few steps include launching tiered data plans in an effort to partially control traffic loads and investing in
a next-generation 4G network and backhaul technologies such as Wi-Fi and small cells. Some carriers are
selling femtocells, a low power cellular base station, to their end users as signal extenders or boosters as
well as exploring options such as spectrum re-farming.
The recent completion of the AWS-3 spectrum auction 8
in January 2015 netted $44.899 billion in
provisional winning bids also demonstrates the extreme need for spectrum. The FCC is now working on a

18. ______________________________________________________________________________T-Mobile
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18
two-way “incentive auction” plan to buy spectrum from TV broadcasters for proceeds and allocate these
airwaves to wireless carriers through forward-selling auctions. This process is expected to be lengthy and
is estimated to take another five to eight years with the recent delay in the start of the auction moving to
early 2016.
The FCC has also recently partnered with the National Telecommunications & Information
Administration (NTIA) to test spectrum sharing between commercial organizations and government in the
1695-1710 MHz and 1755-1780 MHz AWS-3 bands. This effort may enable the FCC to auction paired
spectrum in the future but ultimately carriers will continue to address the lack of adequate spectrum
primarily in three ways:
1) Lobbying for the auctioning of additional spectrum,
2) Working on more efficient use of their existing spectrum
3) Adopting new technologies that will enable more seamless spectrum sharing between parties.
Carriers continue to own and use multiple spectrum band licenses with significant concentration
in the personal communication services (PCS) (~1.9 GHz) and advanced wireless spectrum
(AWS) (~2100 MHZ and 1700 MHZ) categories in North America.
THE FUTURE AND THE THREAT OF SUBSTITUTION:
“Our focusis on creating a global communications systemthat would be larger than anything that has
been talked about to date,” -Musk
Although there are no immediate threats to infrastructure based cellular service, but this may not be the
case in years to come. With phone apps services such as Viber and Skype have been catering largely non
domestic callings throughout the world, their wide acceptance has generally been limited due to the speed
and availability of internet services. In January 2015, Elon Musk announced a new venture to put internet
providing satellites on Earth’s orbit and later extending it to Mars 9
. The space internet venture intends to
use hundreds to satellite to orbit 750 miles above Earth’s orbit and provide low costing high speed
internet to over 3 Billion people that do not have internet access. This by definition creates a new global
system where devices beyond the regular reach of home’s wifi to be in ease of reach as they connect with
the internet. In an interview with Bloomberg, “The speed of light is 40 percent faster in the vacuum of
space than it is for fiber,” Musk says. “The long-term potential is to be the primary means of long-
distance Internet traffic and to serve people in sparsely populated areas,” said Musk. Although this may
sound highly ambitious, Musk has investment backing coming from companies such as Google and
Fidelity. 10
As for competition, Greg Wyler of OneWeb is looking to produce similar technological efforts
and is backed by Qualcomm and Richard Branson of Virgin Group.

19. ______________________________________________________________________________T-Mobile
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19
Issue At Hand
Post switching its acquisition strategy, T-Mobile has seen a significant growth in customer count
primarily due to its new industry distributive methods. As the company takes a growth path, it continues
to risk losing its newly acquired customer base due to no downs that will hold a customer to stay with the
service. Besides this the company continues to suffer industry bottleneck of limited cellular spectrum
available from the government.
Conclusion
After getting an overwhelming response via email from company employees, John Legere,sifted through
his emails to discover that employees at all levels in his organization have taken time to provide feedback.
He’s amazed to see responses from the front line employees discussing customers’ needs and desires to
managers discussing people that will manage to bring out the desired outcomes. He continues to admire
his engineers to bring to his attention regarding the latest and upcoming technologies and ideas to
continue to improve process.
Legere,closes out his day by connecting with his product development and Marketing to design
methodologies and campaigns that will fully integrate the front line and other staff members as focus
groups and to continuously engage with current and prospect customers at full lifecycle to understand
what customers want.
Legere understands that he has already brought in revolutionary disruptive ideas to the industry which
will now require evolution to stay above the edge and hence profitable. He understands his next move
will come from technology and from product catering to his end customers who ultimately decide the
future path of T-Mobile.

20. ______________________________________________________________________________T-Mobile
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20
WORKS CITED
Part I: Company
1. http://www.ibisworld.com/industry/default.aspx?indid=1267
2. http://www.naics.com/naics-code-description/?code=517210
3. CTIA wireless industry indices, 2004
4. http://www.statista.com/statistics/199359/market-share-of-wireless-carriers-in-the-us-by-
subscriptions/
5. https://apps.fcc.gov/edocs_public/attachmatch/DA-14-1862A1.pdf
6. http://www.ctia.org/your-wireless-life/how-wireless-works/annual-wireless-industry-survey
7. http://www.ieeeghn.org/wiki/index.php/Evolution_of_Cell_Phone_Technology
8. http://en.wikipedia.org/wiki/Spectrum_reallocation
9. http://www.bloomberg.com/news/articles/2015-01-17/elon-musk-and-spacex-plan-a-space-
internet
10. http://www.space.com/28316-spacex-elon-musk-google-fidelity-investment.html
11. http://cdn.ttgtmedia.com/searchTelecom/downloads/SearchTelecom_Fundamentals_of_LTE_Cha
pter_1.pdf
12. http://en.wikipedia.org/wiki/AT%26T
13. http://en.wikipedia.org/wiki/Verizon_Communications
14. http://en.wikipedia.org/wiki/Sprint_Corporation
Part II: Wireless Telecommunications Industry
1. http://investor.t-mobile.com/Mobile/OfficersandDirectors.aspx?iid=4091145
2. http://www.t-mobile.com/coverage.html
3. http://www.bestmvno.com/t-mobile-mvnos.html
4. http://www.theverge.com/2013/5/1/4286622/t-mobile-us-metropcs-merger-complete-tmus
5. http://investor.t-
mobile.com/Cache/1500059458.PDF?Y=&O=PDF&D=&fid=1500059458&T=&iid=4091145
6. http://www.fiercewireless.com/story/t-mobile-picks-ericsson-nsn-its-lte-vendors/2012-05-07
7. http://www.latimes.com/business/la-fi-legere-tmobile-20141029-story.html#page=1
8. http://explore.t-mobile.com/uncarrier-revolution-year-in-review
9. http://www.t-mobile.com/company/companyinfo.aspx?tp=Abt_Tab_CompanyOverview
&tsp=Abt_Sub_History
10. http://en.wikipedia.org/wiki/T-Mobile_US#History
11. http://www.jwtinside.com/leaderships-purposeful-role-aligning-employees-behind-purpose/
12. http://www.bizjournals.com/birmingham/print-edition/2014/03/21/best-places-to-work-t-
mobile.html?page=all
13. http://www.bizjournals.com/seattle/blog/techflash/2015/03/much-more-than-a-marketing-
campaign-how-un-carrier.html?page=all
14. http://425business.com/t-mobile-unveils-latest-big-tactic-growth/