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T-Mobile network strategy and 5G investment plans

T-Mobile US, a subsidiary of Deutsche Telekom of Germany, has revealed the company’s network strategies and 5G investment update.

T-Mobile reported service revenue of $7.8 billion (+6.5 percent) and total revenue of $10.5 billion (+8.8 percent) in the first quarter of 2018.

T-Mobile engineers have expanded its coverage and are now targeting 325 million people with 4G LTE by the end of 2018 from 322 million people. T-Mobile will increase the number of macro towers and small cell sites it leases to achieve this coverage target.

T-Mobile had equipment deployed on approximately 63,000 macro towers and 19,000 small cell/distributed antenna system (DAS) sites. T-Mobile plans to roll out an additional 20,000 small cells through 2019.
T-Mobile service revenue Q1 2018 Capex

T-Mobile, which is planning a Capex of $4.9-$5.3 billion in 2018 targeting both 4G and 5G, said it will focus on improvement in customer experience to win new users. T-Mobile achieved 1.4 million total net additions in Q1 — 20th consecutive quarter with more than 1 million net additions.

T-Mobile said its 4G LTE download speed reached 32.1 Mbps vs Verizon at 29.7 Mbps, AT&T at 25.8 Mbps and Sprint at 23.8 Mbps. T-Mobile’s 4G LTE upload speed was 12 Mbps vs Verizon at 9.8 Mbps, AT&T at 7.9 Mbps and Sprint at 3.3 Mbps.

Lower churn

TBR analyst Steve Vachon said T-Mobile reported record low postpaid phone churn of 1.07 percent due to the carrier’s enhanced LTE network coverage and data speeds coupled with value-added incentives offered to T-Mobile One unlimited data customers, including free Netflix subscriptions and the #GetThanked rewards program.

T-Mobile will compensate for the saturating smartphone market via its expanding consumer connected device portfolio, through offerings including wearables and its SyncUp Drive connected car platform, as well as targeting commercial IoT customers through the cost savings offered by its NB-IoT network.

T-Mobile Opex Q1 2018
Spectrum

T-Mobile during an analyst call said it would evaluate attending future spectrum auctions this year. The statement assumes importance because T-Mobile is committed to make an investment of $40 billion in the next three years if its decision to buy Sprint for $26 billion goes through.

T-Mobile has an average of 110 MHz of spectrum nationwide. The spectrum comprises an average of 31 MHz in the 600 MHz band, 10 MHz in the 700 MHz band, 29 MHz in the 1900 MHz PCS band and 40 MHz in the AWS band.

T-Mobile also owns millimeter wave spectrum comprises an average of 186 MHz covering nearly 100 million POPs in the 28 GHz band and 106 MHz covering over 40 million POPs in the 37 GHz band.

T-Mobile owned a nationwide average of 31 MHz of 600 MHz low-band spectrum covering 328 million POPs. T-Mobile owns approximately 41 MHz in the low-band (600 MHz and 700 MHz), quadrupling its pre-auction low-band holdings.

T-Mobile started deployments of 600 MHz spectrum. It is live in 823 cities and towns in 31 states, covering 332,000 square miles. It has deployed low band spectrum to nearly 285 million POPs, combining 600 and 700 MHz spectrum.

T-Mobile 5G

T-Mobile aims to use 600 MHz spectrum to deploy America’s first nationwide 5G network by 2020. T-Mobile will upgrade 4G LTE radios to support 5G as it becomes available later this year. Telecom equipment makers Ericsson and Nokia are working with T-Mobile on the 5G launches.

In addition to building out 5G on 600 MHz, T-Mobile announced plans to deliver 5G in 30 cities in 2018, including New York, Los Angeles, Dallas, and Las Vegas, using both 600 MHz and millimeter wave spectrum.

T-Mobile said VoLTE comprised 80 percent of total voice calls in Q1 2018, flat compared to 80 percent in Q4 2017 and up from 70 percent in Q1 2017. Moving voice traffic to VoLTE frees up spectrum and allows for the transition of spectrum currently used for 2G and 3G to 4G LTE.

At present, Indian telecom operator Reliance Jio has nearly 190 million VoLTE customers on its 4G network. Rivals including Airtel, Idea Cellular and Vodafone are in the process of giving VoLTE services to their 4G subscribers.

T-Mobile said its 4×4 MIMO coverage, which is currently available in over 500 markets,  delivers twice the speed and incremental network capacity to customers by doubling the number of data paths between the cell site and a customer’s phone device.

T-Mobile plans to start deploying massive MIMO (FDMIMO) in selected locations later in 2018. T-Mobile has rolled out 256 QAM in nearly 1,000 markets. 256 QAM increases the number of bits delivered per transmission to enable faster speeds.

T-Mobile is the first carrier to have rolled out the combination of carrier aggregation, 4×4 MIMO and 256 QAM in almost 500 markets.

T-Mobile has also started rolling out License Assisted Access technology that utilizes unused 5 GHz spectrum to augment bandwidth. The first LAA small cell went live in New York City in Q4 2017. The LAA small cell technology reached nearly 100 small cells. Customers have experienced 500 Mbps speed in LAA areas.

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