What a difference a few years makes. Two years ago we were busy debunking AT&T's claims
that eliminating T-Mobile from the market would somehow magically improve competition. Sprint was seen as the amusing drunk uncle who was always running short on funds. Two years later and T-Mobile just saw one of the best quarters ever for subscriber gains
, and Sprint has purchased Clearwire and found itself a rich new sugar daddy in Japan's Softbank.
It's almost enough to fill one with optimism about the fact that the wireless market is getting more competitive.
That's certainly the position taken this week by UBS Telecom analyst John Hodulik, who in a research note to investors proclaimed that T-Mobile and Sprint have officially turned the corner in their battle against AT&T and Verizon, winning a larger share of the market as the number of overall possible new subscribers tightens.
According to UBS, T-Mobile is now gaining roughly two customers from AT&T for every customer the company loses. "This is another good sign for future growth and profitability at T-Mobile—and a poor one for competitors—given the shrinking pool of subscribers up for grabs," insists Hodulik in his note. The analyst notes that T-Mobile is going to have a third wave of their "uncarrier" strategy unveiled sometime around Halloween that could add even more wrinkles.
He also pointed out that keeping unlimited pricing alive is also helping both companies.
"As more customers increase the size of their data buckets given higher usage, unlimited pricing plans like T-Mo's will become more attractive," Hodulik said. Sprint meanwhile has more cash, and UBS insists that finally shaking off the disastrous last remnants of their Nextel acquisition (the iDen network they shuttered in June
) has Sprint ready to compete. Hodulik also puts a lot of weight on the fact that Sprint and T-Mobile's LTE deployments are finally just starting to catch up with their rivals.
There's a few dents in Hodulik's forecast that could suggest his enthusiasm is a bit premature, especially for Sprint. AT&T and Verizon still very much enjoy regulatory capture and dominance across wide swaths of the market ranging from lobbying to backhaul provisioning. Sprint's LTE service remains the slowest among all LTE networks ranked
, and the improved coverage Hodulik praises is based on Sprint coverage maps that have been criticized for being total fantasy
While there's certainly some positive things afoot, fans of Sprint and T-Mobile (or just people that like healthy competition) might want to keep that champagne on ice just a little bit longer.