T-Mobile's 'Uncarrier' Strategy Working As It Picks Up 1.3 Million Subscribers

Outpacing Rivals AT&T, Verizon and Sprint

By Published on .

Get ready for some T-Mobile Twitter trash talk.

The mobile carrier, whose brazen (and well-compensated) CEO John Legere is a frequent social media boaster, posted gains in new monthly subscribers outpacing the totals from Verizon and AT&T combined. In its first quarter earnings statement this morning, T-Mobile said it added 2.4 million net subscribers and 1.3 million postpaid subscribers; its two larger rivals picked up 1.16 million postpaid customers during the quarter.

For T-Mobile, the figures are a coup. In 2013, the struggling company kicked-off its "Uncarrier" campaign, which dropped contracts and shed other carrier conventions in a bid to steal subscribers from AT&T, Verizon and Sprint. Its strategy has helped improve the network's reception among consumers next to competitors with heftier marketing budgets.

In April, T-Mobile announced it was dropping overage fees by June, another unconventional measure, and prodded other carriers to take the same step.

"A year ago I promised that we would bring change to what I called this arrogant U.S. wireless industry," Mr. Legere said in a statement this morning. "We are delivering on that promise and our results reflect the growing customer revolution that we've ignited."

By the end of 2014, T-Mobile expects to add between 2.8 million and 3.3 million branded postpaid subscribers on net. The company added 67,000 tablet subscribers during the quarter, after announcing a free data plan for the device in October. But those were less than a fourth of AT&T's tablet quarterly additions.

The downside
Its "Uncarrier" manuevers came at a cost. The company swung to a loss of $151 million for the quarter, after a net income gain of $107 million in the same quarter a year ago.

For some analysts, the company is accelerating to prime itself for a better price for Sprint, which is swiftly losing customers. Bloomberg reported on Thursday that Softbank, Sprint's parent company, has met with at least six investment banks about a potential merger and is plotting the move for as early as June.

On Tuesday, Sprint reported it had lost more than half a million subscribers during the first quarter.

After the earning report, Mr. Legere was quick to broadcast the news, with little concern for being profane

"It's a great day to be magenta," the CEO tweeted, referring to the company's token brand color. He added a warning: "#LotsofTweets coming!"

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