T-Mobile US reported fourth quarter 2016 results that will reinforce competitor commitment to new marketing efforts that in recent days have included new unlimited offers and price reductions.
T-Mobile net customer additions were 2.1 million in the fourth quarter, the 15th consecutive quarter in which T-Mobile generated more than one million total net customer additions. For full-year 2016, total net additions were 8.2 million marking the third year in a row of more than 8 million.
Service revenues increased by 11 percent in the quarter, the 11th consecutive quarter that T-Mobile has led the industry in year-over-year service revenue percentage growth.
For full-year 2016, service revenues increased by 12 percent to $27.8 billion. Total revenues increased by 23 percent in the latest quarter to $10.2 billion, the 14th time in the past 15 quarters that T-Mobile has led the industry in total revenue percentage growth.
For full-year 2016, total revenues increased by 16 percent to $37.2 billion.
Branded postpaid phone average revenue per user (ARPU) was $48.37 in Q4 2016, up 0.7 percent year over year.
For the full year, branded postpaid phone ARPU was $47.47, down 0.4 percent.
T-Mobile US net income increased by 31 percent year over year. For full-year 2016, net income increased by 99 percent to $1.5 billion.
Adjusted EBITDA increased by 12 percent, year over year.
For the third year in a row, T-Mobile US added more than eight million total customers and captured all of the industry’s postpaid phone growth.
Those results are likely to spur competitors to maintain and perhaps even deepen promotional activity in coming days. Even before the release of T-Mobile US financial and operational results, three of the four leading carriers launched new promotions.
The Sprint unlimited plans offer unlimited mobile data, talk and text messaging for $50 per month for the first line (with automatic payment); two lines for just $90 a month; and the third, fourth and fifth lines supplied for free.
In other words, five lines cost just $90 a month. Some might note that, as always, the promotions are time limited, so the long term impact is hard to gauge. Some might argue that additional promotions tend to follow, until the suppliers reach whatever market share goals they have targeted.
Savings through March 31, 2018. After the promotional period is over, customers will pay an additional $10 per month for first line, the second line remains at $40 per month and each of lines three to five are $30 per month.
Verizon then launched new unlimited plans, something Verizon had eliminated in 2011. The Verizon Unlimited plan costs $80 a month, for unlimited data, talk and text, using paper-free billing and AutoPay features.
Both T-Mobile US and Sprint gained market share in the second half of 2016, presumably on the strength of aggressive “unlimited usage” promotions. Verizon previously had stopped selling unlimited plans in 2011.
At the moment, all four leading U.S. carriers offer unlimited usage plans of one sort or another.
Just prior to the Verizon announcement, Sprint introduced a new family promotion, offering five lines of unlimited data for $90 per month excluding taxes and fees. Sprint's promotion lasts through March 31, 2017.
A current T-Mobile US unlimited plan costs $180 plan for five lines and $160 plan for four lines, including taxes and fees.
Multi-user plans cost $45 per line for four lines. Some nevertheless are going to complain. After 22 GB of data usage on a line during any billing cycle, Verizon says it “may prioritize usage” in the event of network congestion. That “throttling” feature always is criticized in some quarters as a violation of the “unlimited” feature, but others simply see that as “fair use” policies.
Also included are up to 500 MB per day of 4G LTE roaming in Mexico and Canada.
T-Mobile US announced the addition of high-definition quality (HD) video and 10 GB of T-Mobile hotspot access, at no extra charge, with monthly taxes and fees included, for T-Mobile US customers on “T-Mobile One” customers, T-Mobile US says.
T-Mobile US also introduced a new offer of two lines on T-Mobile ONE for $100 a month.
The upgrades are available starting February 17, at no extra charge for customers on “T-Mobile One” service plans. Customers can simply activate their new features in the T-Mobile app or at my.t-mobile.com.
Previously, T-Mobile US had been offering unlimited video streaming--without usage charges on the customer’s mobile data plan--at standard definition. The latest move bumps up image quality, and also bandwidth consumption per minute of use.
Customers will get HD quality video streaming and up to 10GB of high-speed Mobile Hotspot data per month, so they can ‘tether’ a laptop or other device to access the Internet. And, after the included 10GB of high-speed data, customers still get unlimited 3G data through the end of the month.
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