MetroPCS to use T-Mobile to expand nationally posted by Joe on November 9th, 2012 - 7:30 am | MetroPCS
Since T-Mobile is a more nationally known brand than MetroPCS, it sounded as though the merger between the two companies would mean the end for the latter brand. Given recent comments from a MetroPCS executive, though, that does not seem to be the case. CFO Braxton Carter said that MetroPCS will use the new network space from T-Mobile to expand into markets it does not currently occupy. This presents a number of issues, of course, but it also makes a degree of sense, given how both carriers operate.
The biggest obstacle, of course, would be the incompatible network technology. That should be bridged in the long run as the combined company continues rolling out LTE markets. But for the time being, the differences would force MetroPCS to offer a different handset lineup in T-Mobile’s GSM markets. They could, possibly, offer T-Mobile’s own handsets, making MetroPCS something of an MVNO.
One question I have is of how the combined company will operate. T-Mobile focuses on postpaid plans, but has lost millions of postpaid customers in the last two years. At the same time, though, they have greatly expanded their prepaid reach. In the third quarter they added 365,000 prepaid customers, continuing a trend that has lasted as long as their postpaid decline. The trend raises the question of whether the combined company would be better off going prepaid, differentiating itself from the three larger carriers.