T-Mobile US managed to end a pretty good year on a very strong note with the lowest postpaid phone customer churn of any fourth quarter in the company's history, among other highlights. To be specific, the company only saw 0.99-percent churn in the postpaid segment for this quarter, down roughly 19 points year-over-year. Between prepaid and postpaid, the firm saw around 2.4 million net additions, making this its best quarter ever for that metric. Those low churn numbers indicate that those customers are probably here to stay, for the most part.
Background: To break down those record-breaking figures, T-Mobile saw a grand total of 7 million net additions in 2018, of which 4.5 million were postpaid. 1.4 million of those postpaid additions happened during the fourth quarter, and a full million of them were postpaid phone customers. All of this feeds into T-Mobile's grand total customer count of a whopping 79.7 million, counted as of the end of 2018. The Un-Carrier initiative, spearheaded by CEO John Legere, is credited for a large portion of the company's recent success. According to T-Mobile's report, it has added some 46 million customers since Un-Carrier began in 2013. These figures exceeded guidance for the whole year, and cap off 23 quarters and counting wherein more than a million customers switched over to T-Mobile in some form, be it prepaid phones, postpaid phones, or other connected devices. This is also the fifth consecutive year that's seen T-Mobile add 5 million customers or more to its ranks. Those incredible churn figures speak to customer retention, though the vastly less locked-in prepaid customers obviously tended to head for greener pastures more often, resulting in a 3.99% churn figure in the fourth quarter for the prepaid segment.
Impact: T-Mobile has continued to roll out new Un-Carrier moves on a regular basis that have worked to change the public's perception of the company and, for the most part, provide more value to customers. CEO John Legere makes no secret of the fact that he believes this to be the biggest reason that the company has managed to pull closer to its two largest rivals, and the numbers back up his claim. Right now, T-Mobile is in the midst of trying to complete a merger with Sprint, a move that has seen significant challenges, delays, and complications. As we roll on into the 5G era, the two plan to come together in order to marry their spectrum portfolios and exact a multi-tiered and multi-faceted 5G rollout that could conceivably rival or even exceed those of Verizon and AT&T, who both have far more free cash to throw at their 5G rollouts. T-Mobile and Sprint will seemingly continue to exist as separate companies, merging their operations only on the backend, which means that customers who have come to know and love this new T-Mobile since Legere took the helm should have nothing to worry about in the coming months and years. Whether that assumption actually remains true can only be found out in due time, obviously. One thing that is certainly true is that if the merger falls through, both carriers will see some trouble with 5G.