T-Mobile USA Inc. reported a bleak fourth quarter. The industry’s No. 4 carrier said it added 621,000 customers during the final three months of 2008, which was below the 670,000 customers it added during the previous quarter and well below the 951,000 customers it added during the fourth quarter of 2007.
Further darkening its results was the announcement that 57% of its net additions during the quarter were non-contract customers, a slight increase from the 56% during the third quarter, but a dramatic surge from the 23% during the fourth quarter of 2007. Non-contract customers considered less valuable as average revenues are typically lower than contract customers and churn is higher.
This was on display as T-Mobile USA’s customer churn increased from 2.8% during the fourth quarter of 2007 to 3.3% in 2008. The carrier attributed the increase to the seasonally higher prepaid churn in the fourth quarter of 2008 compared to the third quarter of 2008.
T-Mobile USA said it added 4.07 million customers during 2008; 2.94 million of them organically and 1.13 million were acquired as part of the SunCom Wireless Inc. acquisition. These results only further prove the skepticism that the four big carriers have shrunk down to the big two.
While Verizon Wireless didn’t add quite as many customers during the fourth quarter as it’s used to, it still managed to recruit more than 1 million new subscribers and rise to the No. 1 position in the U.S. market. AT&T Mobility added 2.1 million customers during the fourth quarter. Sprint Nextel Corp. has yet to post Q4 results, though analysts expect the carrier to post a net customer loss of around 1 million subscribers.
T-Mobile USA said it plans to report fourth-quarter earnings in late February.
T-Mobile USA posts difficult Q4
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