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T-Mobile Loses Subscribers, Smartphones Flat

by Peter Svensson
Thursday Aug 9, 2012
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NEW YORK (AP) - The long slide of T-Mobile USA continued in the latest quarter, as the country’s No. 4 cellphone company lost subscribers and struggled to sign people up for smartphones.

The company, a subsidiary of Germany’s Deutsche Telekom AG, said on Thursday that it lost a net 205,000 subscribers in the second quarter, a record for the period.

Among phone subscribers under contract, it lost 557,000 subscribers, also the highest number of the second quarter. Phone subscribers on contract-based plans pay the most, and are the bread and butter of large wireless carriers.

T-Mobile’s revenue from monthly fees on contract service fell 9 percent from a year ago. The larger wireless carriers - Verizon, AT&T and Sprint - all managed to increase this number in the second quarter.

While other big carriers rely on boosting smartphone use to raise monthly fees, the number of smartphone users at T-Mobile USA was flat from the first quarter, at 11.6 million.

Thanks to job cuts, T-Mobile continued to be profitable, with a second-quarter net income of $207 million, nearly flat compared with $212 million a year ago.

Overall revenue fell 3 percent from a year ago to $4.9 billion.

The strong dollar helped T-Mobile’s results boost those of its German parent, which reports results in euros.

Last year, T-Mobile agreed to be bought by AT&T Inc., but the deal was blocked by U.S. regulators. During the quarter, CEO Philipp Humm resigned, and was replaced by Jim Alling on an interim basis.

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