T-Mobile Has Little to Offer US Mobile Providers

08.09.2009
Say hello to T-Orange. That is not the official name of ...at least not yet. The alliance seems to create a formidable entity in the battle for mobile provider supremacy in the United Kingdom. Unfortunately, T-Mobile in the United States is languishing in fourth place with little hope of reaching a similar deal.

The United Kingdom partnership gives the new entity over 28 million combined customers and a 37 percent stake in the U.K. mobile market. In the United Kingdom, that puts 'T-Orange' ahead of Vodafone UK, making it the leading mobile service provider in the United Kingdom.

By those standards it would seem that T-Mobile's 33 million plus subscribers in the United States should make it a dominant player. Unfortunately, 33 million customers would make it the number one provider in the UK, but in the United States it garners a meek 12 percent of the market and lands , well behind Sprint.

T-Mobile's position in the United States mobile provider food chain limits Deutsche Telekom's (T-Mobile's parent company) options. It can try and compete on its own, seek a similar strategic partnership as the 'T-Orange' deal, or put itself on the auction block and hope to get absorbed into a larger competitor.

It may not seem so in most markets, but there are other providers aside from T-Mobile, Verizon, AT&T, and Sprint. In fact, there are a lot of smaller market mobile service providers. T-Mobile could adopt a strategy of scrapping it out by buying these smaller competitors to grow its subscriber base and extend the reach of its service.

Being smaller has some benefits in terms of being more strategically agile and able to deliver innovations that larger competitors are too cumbersome to adopt. Still, fighting to grow organically can be a costly and arduous battle and it would still be a long shot to even catch Sprint, much less achieve any sort of market dominance.