T-Mobile Continues to Flounder, Loses 93,000 Customers

Source: AP

T-Mobile continues to bleed customers as people switch to more high profile companies like Verizon and AT&T in search for better phones and bandwidth.

T-Mobile USA, the fourth-largest U.S. wireless carrier, said Thursday that it added crucial contract-signing customers even though it lost subscribers in the second quarter as prepaying subscribers fled to other carriers.

It’s a reversal of what the carrier had seen over the past year — a reduction in contract subscribers since last year’s second quarter, while adding prepaying ones.

Now, tough competition in the prepaid market, where customers don’t sign contracts and usually pay much less per month, means T-Mobile subscribers are being siphoned off. It lost a net 199,000 prepaying customers, compared with a gain of 268,000 in the same quarter last year.

The rate of prepaying subscribers who cancel service every month rose from the already high 7 percent a year ago to 7.6 percent.

T-Mobile, the Bellevue, Wash.-based unit of German phone company Deutsche Telekom AG, added a net 106,000 contract customers, helped by a variety of promotional offers. That was up from 56,000 gains in the same quarter last year, and from a loss of 118,000 customers in the first quarter of 2010.

T-Mobile’s improvement in contracts contrasts with the two larger carriers, Verizon Wireless and AT&T Inc., which have both posted large declines in contract additions this year. However, they’re still growing much faster than T-Mobile. Sprint Nextel Corp. is still posting net subscriber losses.

In total, T-Mobile lost 93,000 customers, ending the quarter with 33.6 million.

T-Mobile posted net income of $404 million, down from $425 million a year ago. Revenue was $5.36 billion, almost flat with $5.34 billion a year ago. Revenues were helped by higher sales of smart phones, balanced by lower monthly calling fees. T-Mobile is aggressively boosting its data network speeds to compete with the bigger players.

Parent company Deutsche Telekom delisted its shares from the New York Stock Exchange in June, a move it said was aimed at lowering administrative costs. The shares continue to trade on the Frankfurt exchange, where they fell 0.7 percent.

Showing 7 comments

thomas at 2:39pm 17th December 2010 Will I bin thinking of moving on because tmobile justs keeps f###me and the phones are great and I like the sevice but I have been with them for seven years and they want to much for a phone and they keep getting higher
Travis at 12:35pm 11th August 2010 T-Mobile is consistently rated as the 1 of the best in customer service. It sounds like a couple isolated incidents. As a comparison ATT is rated 1 of the worst in customer service. I've used them all and ATT is BY FAR the worst (sprint would be 2nd). I would only choose between T-Mobile and Verizon, with T-Mobile being the least expensive of them all.
barney at 3:16pm 6th August 2010 I had T mobile for 3 years and people would keep calls short because of all the static and difficulty hearing me. I had no idea how bad my reception was. I just figured that was how all cell phones sounded. I switched to the much more expensive verizon after a bit of research and now when I talk to Tmobile users, I sometimes think we are using tin cans to communicate. Verizon service is great, though too pricey. If Tmobile had their current prices and would get better cell towers, and fix their call quality I would switch back in a minute.
Nick at 12:41pm 6th August 2010 I too, like Philip, have loved T-Mobile for heir customer service and willingness to backdate account changes allowing me to avoid overages. Their customer service tech support has been great and they support phones they dont carry like the iphone (friend's) or Nokia N80 (mine) when there is a problem.
Philip at 8:57am 6th August 2010 I've always loved T-Mobile. Their customer service has been nothing but wonderful! My issues have always been resolved quickly and easily.
John at 7:47am 6th August 2010 The last time I went to recharge my pre-paid account with T-Mobile it didn't get credited correctly. It took four calls to their miserable excuse for customer service to get it close enough to right that I didn't call back. Every time I called, they just made some lame promise to get me to hang up and go away. Finally, I insisted on talking to the guy who would actually make it right and I didn't let him off the call until I had verified it. When these minutes are gone, so am I.
Don at 6:20am 6th August 2010 I left T-Mobile after 7 years with multiple lines because they would not give me a reasonable deal on an Android phone. They treated me like crap. I walked into a Radio Shack got an HTC hero for 70 bucks, love their plan. Kiss-Off T-Mobile!