T-Mobile US said something surprising and perhaps worrisome. As the cable TV industry is showing wireless growth, T-Mobile US says they are not worried about them as a competitive threat. What is concerning is, Comcast Xfinity Mobile, Charter Spectrum Mobile and Altice Mobile are showing steady and ongoing growth as MVNO resellers, and that growth is coming from competitors in the wireless industry. Competitors like T-Mobile US.
Competition, new ideas, new thinking, new ways to tacking problems are always a threat. They should never simply be ignored or dismissed. Companies and executives who do, often regret it.
One example, consider what Uber and Lyft did to the age-old taxi and limousine industry. They quickly and negatively impacted the existing leaders and transformed the entire industry.
Peter Osvaldik, CFO of T-Mobile US, recently said they are not threatened by cable television competition in wireless. While this sounds great, there is another side.
· On one hand they are full of self-confidence. That’s good.
· On the other hand, it is also concern for investors who have followed the wireless industry over the last few decades. Competition often changes industry leadership.
Companies are only as strong as their weakest link
That is exactly what AT&T Mobility and Verizon Wireless said when T-Mobile US was a much smaller competitor trying their hardest to grow and become successful. Several years later they succeeded after acquiring Sprint and continuing to grow.
Today, AT&T and Verizon are battling in head-to-head competition with T-Mobile US.
Not paying attention to potential threats is like a racing horse with blinders on. They never know what is going on around them. And that is a potential weak link in an otherwise strong chain.
And you know what they say about the weak links. A company is only as strong as its weakest link.
CFO Peter Osvaldik says T-Mobile US not concerned with competition
Rather than simply saying they are not concerned with this growing competitive threat; T-Mobile US should be saying, one: they are proud of their top-notch performance in recent years and expect to continue that. Two: they are always aware of the changing marketplace and the ongoing threats it poses, and they are committed to understanding and battling ongoing competition.
You see, the big three wireless competitors are Verizon Wireless, T-Mobile US and AT&T Mobility. These companies own and operate their own wireless networks.
In fact, Verizon and AT&T were the top two players until T-Mobile US won second place leaving Ma Bell in third place.
AT&T Mobility fell to third place after Verizon and T-Mobile US
There are also many smaller competitors like US Cellular, C Spire and others.
Plus, there are countless MVNO resellers like Xfinity, Spectrum, Altice’s Optimum Mobile, Cricket, Pure Talk, Consumer Cellular, Tracfone and others.
Today, the MVNO marketplace is a rapidly growing space.
Every competitor is important and a threat whether they own a network or are a reseller.
That means every player in the wireless marketplace must be focused on both protecting their customer base and growing it by winning business from competitors.
So, while I respect the strength of the T-Mobile US attitude that they are not concerned with cable TV wireless growth, that also leaves me with an uneasy feeling in the pit in my stomach.
Lack of concern for competition could leave T-Mobile US vulnerable
My level of respect for T-Mobile US has grown in recent years. They were at the bottom of the barrel compared to competitors. They never saw the need to upgrade from 2G to 3G. They were a mess.
Then, when Apple iPhone and Google Android entered the marketplace, T-Mobile found themselves struggling to keep up with exploding demand for wireless services.
T-Mobile US lost customers to Verizon, AT&T and Sprint, who were better prepared for this rapid growth rate.
Only after years of hard work under a new CEO did T-Mobile US not only recover but accelerate their growth. Today, they are a strong leader in the wireless space.
They can be very proud of what they have accomplished, so far.
However, that success was yesterday. What about tomorrow?
Every competitor needs to stay ahead of the curve. Every competitor should always be concerned with hanging onto and growing their customer base. Every competitor needs to always be concerned with the changing marketplace, changing expectations and new competition.
That’s why even though their comments of not being concerned with a rapidly growing competitive sector sound strong, they are also misguided.
Verizon, AT&T, Motorola, Nokia, Blackberry, iPhone, Android, Google
Remember, years ago when T-Mobile US was in their early years of recovery, neither Verizon Wireless nor AT&T Mobility saw them as a threat.
That was a mistake on their part, and they are still paying the price of that misguided arrogance today.
When Motorola was winning for decades, their arrogant attitude about how competition never concerned them. When they didn’t move from analog to digital fast enough, they lost their winning position virtually overnight replaced by Nokia and Blackberry.
Nokia and Blackberry lead the space over the next decade, and both had the same problem. Years later, they were not concerned with the competitive threat either.
Then suddenly when Apple iPhone and Google Android entered the smartphone picture, they were sent to the bottom of the list of competitors along with Motorola.
Remember when Yahoo was the leader in the web search industry, only to be crushed by Google when it arrived.
Yesterday’s wireless leaders not guaranteed to be tomorrow leaders
Example after example warns of winners becoming arrogant, losing their way and ultimately losing the game.
You see, yesterday’s leaders are not guaranteed to be tomorrows leaders.
When you are winning, you tend to think you will always be winning. While that sounds great, it is not true.
Things can change and quickly. Especially in this rapidly changing wireless and technology world.
Winners need to stay hungry just like when they were smaller.
So, while I love the T-Mobile US self-image, I implore them to keep their eyes on the ball. Keep their eyes on the competition.
Not only do they have their own example to consider over the last decade, but also countless other company’s examples over the last several decades.
