Thursday, April 9, 2015

When Will T-Mobile US Become the 3rd Biggest U.S. Mobile Company?

The only question many observers have is how soon Sprint, now the third-largest U.S. mobile service provider, is passed by T-Mobile US. Some think that could happen in the first quarter of 2015. Others think it might take until the second quarter.

But most think the change will happen. 

Sprint executives are right that it doesn't matter much whether Sprint is third or fourth, for the moment. The difference in subscriber counts won't be so large. 

But if T-Mobile US growth rates continue at anything near present rates, that gap will widen. At some point, quantitative change becomes qualitative change. 

And such changes of market share, at the top of any mobile market, and driven by organic growth, are quite rare. 

True, market share does change substantially when there are major acquisitions in a market. But a market share shift driven principally by organic growth is a more dangerous trend. Instead of a reshuffling of ownership, which is what a merger represents, an organic growth shift means consumers are shifting demand. 

Near term, perhaps the change in market share means little. Longer term, it could be quite significant. 

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