Blog Post

Value plans, smartphones lift T-Mobile customer count

Cole Brodman - CMO and EVP, T-Mobile USA at Mobilize 2011T-Mobile USA reported a net gain of 126,000 subscribers in the most recent quarter, marginally increasing its total subscriber base to 33.7 million customers. The No. 4 U.S. carrier attributes the small boost — a turnaround from the prior quarter’s loss of 50,000 customers — to new value plans and unlimited monthly 4G offerings to prepaid customers. T-Mobile also saw a 40 percent jump in the total number of smartphone customers on its network: There are 10.1 million 3G/4G smartphones in use, up from 7.2 million a year ago.

The focus on affordable plan mixes and unlimited offerings to prepaid customers has helped, but now that all three major U.S. carriers have the iPhone (s aapl), I wonder if T-Mobile’s churn rate — the rate at which it sheds customers — will rise a little more next quarter. Even before Sprint (s s) started selling the iPhone, T-Mobile’s churn has been on the rise: It was 3.5 percent in the most recent quarter for both prepaid and postpaid customers, compared with 3.3 percent the quarter before.

Without an Apple iPhone to sell customers, T-Mobile continues to invest efforts in plan differentiation and its 42 Mbps mobile broadband network. Of course, that hasn’t stopped more than a million T-Mobile customers from reportedly using an iPhone on the network, even without support for 3G data. It’s another example of the change I pointed out a few months back: Some customers are choosing hardware first and the supporting carrier network second.

T-Mobile’s smartphones — mainly Google Android (s goog) devices — and the data plans required to use them are helping to raise the average revenue per user (ARPU) for data services, however. ARPU solely for data revenues rose to $14, a boost from $13.60 in the prior quarter and $12.40 in the year-ago quarter. This growth is important as voice revenues erode over time, due to customers using smartphones more for data and apps and less for traditional voice calls.