Ever since buying up MetroPCS, T-Mobile’s focus on prepaid, both through MetroPCS and on their own offerings, has increased a good deal. This past year or so, they’ve really kicked things up a notch. MetroPCS has been offering a number of good deals on great phones and high-value data packages. On the heels of T-Mobile’s earnings call for the quarter, showing off some great figures for year on year profits and good subscriber growth, the earnings call for MetroPCS was put on webcast for all the world to hear and see live.
In total prepaid net growth, T-Mobile reflected year on year growth of about elevenfold. MetroPCS, meanwhile, managed to cinch 72 percent sequential growth as part of that total figure. T-Mobile’s total new prepaid subscribers in this quarter alone was about 807,000, though it wasn’t revealed exactly what part of that figure came from MetroPCS. Aggressively courting users of rival carriers, with T-Mobile’s CEO John Legere admitting that MetroPCS’ offers are made to target Sprint users, T-Mobile managed to snatch a huge percentage of its new users from its rivals. Total prepaid churn for T-Mobile went down to only 3.84 percent, compared to the prior year figure of 4.62 percent. Of special note in the earnings call, however, was MetroPCS’ average revenue per user, or ARPU. In the webcase, Legere said that MetroPCS’ ARPU was “$38, $39 each” and called it one of the “little golden nuggets” of the earnings call.
As a side note, Legere spoke about IoT. Specifically, he told viewers why T-Mobile hasn’t pursued the space quite as aggressively as rivals like AT&T, saying that IoT revenue, compared to traditional revenue sources, simply didn’t stack up. “I think what we need people to start understanding is that some of these adds — these connected cars — these are cents (per month), not dollars.” T-Mobile’s vastly more aggressive approach to prepaid than its rivals, as well as the high ARPU managed by MetroPCS, point to a different attitude about the industry and the opportunities that may be present there. While rivals like Verizon don’t put much stake into the space, T-Mobile and MetroPCS are using prepaid as a major source of revenue.