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Aug. 20, 2015, 7:29 PM
- At least one end result of media consolidation will be all of the big four wireless firms linking up (via merger or alliances) with pay TV, says Oppenheimer's Tim Horan, with a prediction for the four survivors: AT&T, Verizon, Sprint -- and Comcast.
- "Regardless of the timing, we expect all four wireless carriers to align with a paid TV provider in some form," Horan says. He writes that Oppenheimer sees Comcast (NASDAQ:CMCSA) and T-Mobile (NYSE:TMUS) aligning somehow, though Comcast denied interest in outright acquiring the carrier in June.
- Comcast's hand might be forced by AT&T's (NYSE:T) plans for product bundling now that it's closed on DirecTV (NASDAQ:DTV). Charter (NASDAQ:CHTR) -- currently busy trying to acquire Time Warner Cable (NYSE:TWC) -- could deal for wireless as well, as it expands its public Wi-Fi.
- Horan also thinks that Verizon (NYSE:VZ) might be the only real buyer for Dish Network's (NASDAQ:DISH) spectrum haul, which might come on the block after the FCC denied Dish $3.3B in spectrum-auction discounts. Oppenheimer sees only a 10% chance that Dish buys T-Mobile.
- SoftBank had explored a sale of Sprint (NYSE:S) to TV providers including Comcast and Altice, unsuccessfully, and a potential merger with T-Mobile is considered at least as far off as the 2016 presidential election.
Aug. 20, 2015, 6:02 PM
- T-Mobile (TMUS -2.7%) and Beatport -- the streaming electronic music service that's part of SFX Entertainment (NASDAQ:SFXE) -- have teamed up (again) on a hub exclusive to T-Mobile subscribers.
- The offering, called T-Mobile Backstage, features ticket giveaways and early-sale access and free music downloads montyly for those who are T-Mobile customers and registered Beatport users.
- The move is the latest in a few partnerships between Beatport and T-Mobile.
- Meanwhile, SFXE cratered again today, down 24.4%. The stock has lost more than 74% of its value in the past five days, in the wake of confirmation that a go-private deal with its CEO Robert Sillerman was off.
- SFX is pursuing an Oct. 2 deadline for sale interest, and Beatport is an attractive prospect for being parted out from the company's festival business.
- Previously: SFX Entertainment confirms go-private deal off, sets Oct. 2 deadline (Aug. 14 2015)
Aug. 18, 2015, 8:14 PM
- Sprint (NYSE:S) started the day strong and ended even stronger, +5.8%, in the wake of another share purchase by parent SoftBank.
- Sprint's also making a high-profile move away from contracts and phone sales, and analyst Craig Moffett -- known for being a skeptic on Sprint's cash burn performance -- said today the carrier's switch to a leasing model is "an accounting change, and unfortunately it is exaggerating revenue and EBITDA."
- He's got Sprint rated at Sell, with AT&T, Verizon and T-Mobile rated at Neutral.
- "From the consumer's perspective, this is all much ado about nothing," Moffett said of the lease model. "You used to pay about $20 more per month in your service plan in return for getting the phone; now you pay about $20/month for the phone itself."
- From the carrier's perspective, there's a huge difference in accounting, though, and "unfortunately, it has distorted the accounting for the whole sector. Because as you do the sale of phones, it accelerates revenue, and therefore accelerates EBITDA and earnings ... all the companies are now reporting inflated revenues ... and inflated profitability."
- Sprint's gone one step further, he says, by leasing the phones and "taking the cost of the phones off the income statement entirely, move it to the balance sheet and that further inflates earnings. So Sprint is getting 50% of its EBITDA right now from accounting changes."
- Meanwhile, CEO Marcelo Claure and T-Mobile (NYSE:TMUS) CEO John Legere are mixing it up on Twitter again, this time arguing about a RootMetrics survey that put Sprint in third place in overall performance, ahead of T-Mobile.
- Previously: Sprint's Claure to T-Mobile's Legere: Tired of 'Uncarrier bullshit' (Jul. 02 2015)
Aug. 18, 2015, 7:54 PM
- Verizon (NYSE:VZ) led in overall network performance rankings again, according to the first-half report by analytics firm RootMetrics, though Sprint's network investments may be paying off.
- Across the board, the results were similar to the last few analyses by the firm. In nationwide performance tests, Verizon took five wins to AT&T's (NYSE:T) one. In state-by-state looks, Verizon grabbed 253 wins/ties, to AT&T's 95. Sprint (NYSE:S) took 25 and T-Mobile (NYSE:TMUS) zero.
- Metro areas show more variation, but Verizon prevailed overall there too, with 512 wins/ties. AT&T logged 441, T-Mobile 221, and Sprint 180.
- The tests resulted in a RootScore of 94.5 for Verizon, followed by AT&T's 91.8. Sprint finished third with 87.5, and T-Mobile brought up the rear there, with 82. In the first half of 2014, T-Mobile was third in those rankings to Sprint's fourth place.
Aug. 17, 2015, 4:53 PM
- Another brick falls from the contract-wireless wall, as Sprint (S +10.1%) CEO Marcelo Claure tells The Wall Street Journal that the carrier will do away with contracts and shift to a leased-smartphone model by year's end.
- Sprint introduced a lease option last year, and ending its subsidies means that leasing or upfront purchase will be the only ways to get a smartphone from the carrier.
- The move leaves AT&T (T +0.5%) as the only carrier of the U.S. big four that is still offering to subsidize a smartphone buy. Verizon (VZ +0.1%) made its major move earlier this month, and all are following in T-Mobile's (TMUS +1.9%) footsteps on dropping contracts.
- Earlier, Sprint rolled out its "iPhone Forever" plan that served as a precursor to the model: For $22/month over and above the usual monthly fees, customers can upgrade to the latest iPhone as soon as it becomes available, rather than once every two years. Claure says parent SoftBank (OTCPK:SFTBY -1%) will help it monetize traded-in phones.
Aug. 12, 2015, 11:07 AM
- Masayoshi Son's double-down on the future of Sprint (S -6.4%) came after he and another top executive at SoftBank (OTCPK:SFTBY), Nikesh Arora, floated the idea of selling the company to Comcast (NASDAQ:CMCSA) and to France's Altice (OTCPK:ATCEY) -- but getting no uptake, according to The Wall Street Journal.
- "I should go back to where I was focused," he says -- the Internet side of SoftBank -- though a long slog is ahead yet, if he's to turn around a company that hasn't turned an annual profit since 2006.
- Son was banking on a merger with T-Mobile (NYSE:TMUS) and calls his misjudgment of U.S. regulators "one of the biggest mistakes in my life." Now, the focus is on improving the carrier's network as hopes for restarting a merger push with T-Mobile are on hold until after the 2016 presidential election.
- Son appeared on Sprint's earnings call last week to reiterate excitement about the company's future under Marcelo Claure, who Son calls "my soul mate ... a street fighter sharing the underdog experience like myself."
- But fixing Sprint is turning out to be staggeringly expensive. Sprint doesn't have the money for a once-and-for-all fix, Son concedes, and SoftBank's covenants with banks prevent sinking more cash in.
- Ominously, SoftBank has recently invested $1B in a handful of South and Southeast Asian start-ups, and plans to invest more than $10B in India alone.
Aug. 6, 2015, 12:07 PM
- In a unanimous vote, the FCC denied T-Mobile's (NYSE:TMUS) request for a larger spectrum set-aside during the government's wireless airwaves auction next year.
- The carrier -- now the third-largest by customers in the U.S. -- had lobbied for a larger chunk of spectrum to be set aside for smaller carriers (i.e., not AT&T and Verizon) in the low-band auction, an area of the spectrum that the two giants dominate.
- There will be a set-aside, just not the 40 MHz that T-Mobile was seeking, in what is seen as a compromise by the FCC's Democrats after last year's vote to establish reserve spectrum.
- The FCC is working to keep the auction on track for the first quarter, and it's currently expected March 29. The agency is finalizing bidding procedures.
- Wireless Carriers today: T -1.3%; VZ -0.5%; TMUS -0.5%; S +2.4%.
Aug. 4, 2015, 7:26 PM
- Major U.S. telecoms are reporting widespread phone outages in the Midwest and Southeast, for both wireless and wireline service.
- The outages seem centered in Kentucky, Indiana, Alabama and Tennessee, but they affect customers of AT&T (NYSE:T), Verizon (NYSE:VZ), Sprint (NYSE:S) and T-Mobile (NYSE:TMUS). All four of those carriers acknowledged the outages on Twitter accounts.
- AT&T suggested that the problem has been pinpointed to a hardware issue and that engineers are working with vendors to restore service.
Aug. 3, 2015, 6:25 PM
- ProShares is shuttering its UltraShort Telecommunications ETF (TLL -5.7%), the fund that bets against big telecoms like AT&T (NYSE:T) and Verizon (NYSE:VZ), due to lack of interest.
- The fund -- a double-short fund working on the inverse of the Dow Jones U.S. Select Telecommunications Index -- will close after the market on Sept. 14. Trading had slowed to about 100 shares on average.
- Top components of Dow Jones' telecom index that the fund bet against are AT&T, Verizon, SBA Communications (NASDAQ:SBAC), Level 3 Communications (NYSE:LVLT), CenturyLink (NYSE:CTL), T-Mobile (NYSE:TMUS), Frontier (NASDAQ:FTR) and Sprint (NYSE:S).
- TLL was down 7.6% over the past six months. The iShares U.S. Telecommunications ETF (NYSEARCA:IYZ) -- tracking the same index from the other direction -- is down 0.5% YTD.
Aug. 3, 2015, 10:30 AM
- T-Mobile (NYSE:TMUS) is up 1% after Barclays raised its price target to $45, from $40.
- Shares closed Friday at $40.66. They're currently trading at $41.05.
- Shares are up 10.7% in three days since the company reported a Q2 earnings beat.
- On Friday, Pacific Crest raised its price target on the stock to $47, from $43.
Jul. 30, 2015, 3:22 PM
- On T-Mobile's (NYSE:TMUS) earnings call today, CEO John Legere expounded on consolidation and where he thinks technology is leading, signaling that he's still open to tie-ups: After all, he expects more players to get into wireless service, whether it's Dish Network with its spectrum haul, or Google with Project Fi, or even Comcast.
- "As the cable players use Wi-Fi as a capability to serve their subscribers ... you know that a player like a cable company and a player like T-Mobile [together] ... is better," Legere said. Customers will look at their accounts, and say "I have Comcast, and I have T-Mobile ... Why don't these guys do something together" to provide a seamless experience. Combinations like that are questions of "not if, but when," Legere said.
- He took time to tweak Sprint again, criticizing its new plan: "Sprint's $80 all-in plan is the return of contracts ... We will not be moving in that direction."
- With regard to video -- and particularly Verizon's upcoming Go90 mobile service -- he took a cautious stance and said T-Mobile would be in that area if customers wanted it. "If you interview 10 millennials in Times Square, how panting are they for Go90? ... Let's wait and see."
- That's another partnering opportunity, he said, looking forward into a world where content is moving to the Internet even as the Internet is going mobile: "Content to the Internet, Internet to the mobile devices, it's a potential opportunity for T-Mobile to partner, ally, merge with" other players.
- Shares are now up 5.3% this afternoon following the strong report.
- Previously: T-Mobile up 1.7% early after solid Q2 beat, raised customer guidance (Jul. 30 2015)
Jul. 30, 2015, 9:14 AM
- T-Mobile (NYSE:TMUS) is up 1.7% premarket after Q2 results where it beat profit expectations soundly while growing revenues and built up customers -- thanks to aggressive competition as it continues to trade profit margin for subscriber growth.
- The carrier raised its full-year projection for customer growth again, after adding a net 2.1M customers (1M postpaid). It now sees 2015 total branded mainstream adds of 3.4M-3.9M customers, up from a previous 3M-3.5M. Churn fell to 1.3%, from a year-ago 1.5%.
- Profts fell to $361M from a year-ago $391M, but swung from a $63M loss in Q1. Adjusted EBITDA of $1.8B (up 25%) beat an expected $1.767B. Service revenues of $6.1B were up 12% Y/Y.
- Of the 1M postpaid net adds, 760K were branded postpaid phone net adds, and the company again expects to capture all of the industry's postpaid phone growth.
- Branded postpaid phone ARPU was up 3.8% from Q1, to $48.19, mainly due to noncash net revenue deferrals for its Data Stash offering. That's down 2.3% Y/Y, though. Branded postpaid average billings per user was $63.29 (up 5.9%) and average revenue per account was $113.50 (up 6%). Meanwhile, branded prepaid ARPU was up 1.8% to $37.83.
- The company reiterated guidance for full-year EBITDA of $6.8B-$7.2B, in line with expectations, and for cash capex of $4.4B-$4.7B.
- Conference call to come at 11 a.m. ET.
Jul. 30, 2015, 7:38 AM
- T-Mobile US (NYSE:TMUS): Q2 EPS of $0.42 beats by $0.24.
- Revenue of $8.2B (+14.2% Y/Y) beats by $260M.
Jul. 29, 2015, 1:07 PM
- Sprint (NYSE:S) is leading major U.S. telecom gainers for a second day, +5.9%, as it rolls out a new family plan in response to a family-plan price cut from T-Mobile (NYSE:TMUS)
- Switchers to Sprint are being offered four lines with unlimited talk/text and 10 GB of high-speed data for $100/month, which it says will save families $480/year over Verizon's comparable plan, and $720/year over AT&T's.
- For data burners, Sprint says families can choose a 40 GB plan for $20 more per month. It continues to offer paying off old phones/contracts to enable switchers.
- Sprint's now up 12.2% over the past two days in coming off a 52-week low on Monday.
- Previously: Sprint and T-Mobile: Who's No. 3 (round two) (Jul. 28 2015)
- Previously: Sprint rebounds, +6.8% off 52-week lows (Jul. 28 2015)
- Previously: T-Mobile cuts price, increases data on family plans (Jul. 14 2015)
Jul. 28, 2015, 10:06 PM
- Another quarter of telecom earnings, and another quarter where analysts figure that Sprint (NYSE:S) will be overtaken by T-Mobile (NYSE:TMUS) in total customers to take the No. 3 spot among U.S. wireless providers.
- Last quarter, T-Mobile effectively captured all of the industry's subscriber growth, but Sprint held the No. 3 position, 57.1M customers to 56.8M, despite shedding some core postpaid phone subscribers.
- Now, analysts expect heat (and perhaps more Twitterfights) as they predict that T-Mobile may have finally taken the lead in the quarter ended June 30.
- GSMA Intelligence is expecting T-Mobile to report 58.9M customers to Sprint's 58.3M connections, when Sprint releases its final numbers Aug. 4.
- "It almost has a psychological significance that trumps the practical significance," says IDC's John Jackson.
- T-Mobile reports Thursday, and consensus estimates have it reporting $0.22/share in earnings on $7.96B in revenues and $1.77B in EBITDA. Sprint reports Aug. 4, and consensus estimates have it posting a loss of $0.05/share on $8.33B in revenues and $1.82B EBITDA.
Jul. 20, 2015, 3:25 PM
- The FCC is pointing to March 29 -- very late in Chairman Tom Wheeler's Q1 2016 target -- to begin its incentive auction of 600 MHz broadcast airwaves, according to a list of agenda items it's circulating.
- Observers had worried that a postponement of voting on auction rules until Aug. 6 would endanger the Q1 plan. The FCC had delayed the final vote so that stakeholders could submit filings on the rules, with the "duplex gap" a particular point of contention.
- The exact start date is still subject to change before the final FCC vote.
- Spectrum players: VZ, T, TMUS, S, DISH, SBGI, EVC
- Previously: FCC delays rules vote for broadcast spectrum auction (Jul. 15 2015)
T-Mobile US Inc provides wireless communication services in the postpaid, prepaid, and wholesale markets. The Company's products and services include voice, messaging, data services, wireless devices, smartphones and other mobile communication devices.
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