T-Mobile Subscribers Have Fled

AT&T will undoubtedly file its own lawsuit in the wake of the U.S. Department of Justice lawsuit opposing the purchase of T-Mobile USA on antitrust grounds. The Federal Communications Commission, for its part, also must approve the deal, and hasn't spoken yet.

T-Mobile will gain from a deal failure, to the tune of $6 billion, including $3 billion in cash, spectrum rights and roaming agreements with AT&T. But T-Mobile's fundamental problem--that it is a rather weak fourth contestant in a market lead by AT&T and Verizon Wireless, will not change. When all is settled, relating to the proposed AT&T take-over, it is conceivable T-Mobile USA will continue to face strategic issues, adding yet another element of uncertainty to the U.S. mobile business.

T-Mobile’s revenue and total subscribers took a hit from April to June 2011, as the carrier’s pending merger with AT&T apparently drove away customers.

The Bellevue, Wash.-based carrier’s revenue dropped only slightly in the second quarter, but the company’s profits fell by nearly half from the same period last year. T-Mobile also reported it had lost 50,000 customers, bringing its total to 150,000 lost for the year. The carrier lost just 56,000 subscribers in all of 2010.

T-Mobile has made several moves to attract new customers and hold onto existing ones over the past several months. The carrier increased its 4G network to reach 170 million consumers in the U.S., came up with special offers like one year of free data for new subscribers and even brought back unlimited data options to differentiate itself from AT&T and Verizon. Despite T-Mobile’s efforts, however, customers still leave the carrier in droves.

T-Mobile Subscribers Flee as AT&T Merger Looms