A recent investor analysis concluded that without the iPhone, T-Mobile USA is unlikely to be met with enthusiasm from wireless customers in the near future.
In a recent blog post, T-Mobile USA government affairs director for technology and engineering policy Steve Sharkey argued that approving a pending deal between Verizon and SpectrumCo would worsen T-Mobile’s existing woes. The company claims its spectrum is in short supply, and that Verizon is grabbing up the remaining available spectrum — a resource T-Mobile argues its customers badly need for their bandwidth demands.
But unfortunately for T-Mobile, an April 4 report from the financial firm Nomura Equity Research concluded that its problems would not be solved by more spectrum, and that it had sufficient supply to last through 2015. T-Mobile acquired more as part of a breakup deal negotiated with AT&T.
T-Mobile’s revived efforts to compete, the report stated, only served to increase pressure on an already competitive space. This view runs contrary to the position maintained by smaller carriers and media reform activists in Washington, D.C.: that the U.S. wireless market is increasingly moving toward a duopoly between AT&T and Verizon, which would weaken wireless competition.
“Overall, the meeting reinforced our view that the US wireless market is too competitive and is poised for incremental competitive pressures resulting from a renewed marketing effort from T-Mobile USA,” wrote Nomura analysts after they met with T-Mobile investor relations vice president Nils Paellmann.
Nomura, overall, was skeptical of whether the market would well receive T-Mobile USA’s efforts in the future without the iPhone, whose popularity continues to drive consumer demand.
“T-Mobile USA remains Deutsche Telekom’s (DT) number one problem,” said Nomura. “If we think DT’s refarming/LTE strategy makes a lot of sense, commercial momentum is unlikely to recover in the coming quarters without the iPhone. In the meantime, we don’t expect the market to give T-Mobile USA the benefit of the doubt on its brand relaunch in 3Q.”
This story has been updated for clarity.