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T-Mobile loses 77,000 customers yet posts a profit

By: , IntoMobile
Wednesday, May 12th, 2010 at 10:47 AM

There’s some troubling news for T-Mobile, as the company’s first-quarter results show it posted a profit but lost 77,000 net customers. When you’re losing more customers per quarter than Sprint, there’s a clear problem.

What’s even more troubling is that the fourth-largest U.S. carrier lost 118,000 contract customers. Normally, this has been counterbalanced by its prepaid strength, but it only added 41,000 prepaid customers (compared to the 488,000 prepaid users it gained during the same period last year). Overall, it has 33.7 million subscribers at the end of the quarter, a slight dip from the 33.8 million at the end of the fourth quarter.

Why is this happening? T-Mobile says it had a drop in FlexPay contract customers and its stellar Even More Plus plans have failed to capture much momentum. On the positive side, it had 5.2 million customers using “3G-capable converged devices” (mainly smartphones) and its churn and average revenue per user remained relatively consistent.

“As T-Mobile USA continues to drive data as a revenue growth engine, we experienced meaningful traction in the first quarter of 2010 by getting a host of next-generation smartphones into the hands of our customers,” said Robert Dotson, CEO of T-Mobile USA, in a prepared statement. “Products like our popular myTouch 3G and HTC HD2, coupled with our industry-leading data value message, continued our strong year-over-year data revenue growth.”

The HD2 is a pretty nice device but I’m worried about the company’s high-end lineup. The upcoming myTouch Slide 3G is a mighty fine device with some great software tweaks but I don’t know if it qualifies as a flagship device. This is especially apparent when you compare it to the EVO 4G, Droid Incredible or the next iPhone.

Luckily, we received word that the magenta carrier is working on delivering a handset that’s on par with the Nexus One. Let’s hope this Project Emerald leads to a really cool T-Mobile smartphone.

About The Author

Marin Perez

Marin Perez has torture tested cell phones and smartphones for industry leaders like CNET and InformationWeek. He remembers when 4G was just a screen on PowerPoint presentations and is fascinated with the amount of innovation out there. Marin has spent a lot of time with BlackBerry and Android but he finally broke down a bought an iPhone to see what all the hype's about. He also has too many tablets.

  • mrbill

    The reason T-MO is losing customers is because they continue to treat their existing customers like they have the plague (for the record, I am a T-MO customer). Sure they have the best customer service of any carrier out there, but they offer their best deals to new customers. Not how you keep customers. I own my own business (actually three businesses) The reason I have been successful is I give my existing customers the best deal and service rates I can. They NEVER, EVER pay more for ANYTHING than anew or potential new customer. Usually they pay the same, but I will give them better contract terms or free items. I value my customers and have had some of the for over 15 years.

  • Bob

    Nexus One is available for T-Mobile. It is even subsidized ($179). You just have to order it from Google for some reason.

    A major issue now is probably their total lack of data on their prepaid plans (which are becoming more and more popular). Their competitors are starting to add data options.