Can T-Mobile become the operator of rural America?

When OpenSignal released its State of Mobile Networks report for the U.S. last month, we noted T-Mobile’s big uptick in LTE coverage — the result of new network investment using new low-band spectrum. Simply put, T-Mobile customers found that they could connect to data signals in more places, whether in the recesses of buildings or out in the countryside where T-Mobile has traditionally offered little service.

Now it looks like T-Mobile is capitalizing on that newly amped-up coverage, particularly in places outside of its core urban footprint. As reported by FierceWireless, T-Mobile is opening up new stores and expanding online retail sales to an additional 30 million to 40 million people in the U.S. Speaking at a Morgan Stanley investor conference, T-Mobile US CFO Braxton Carter said T-Mobile will make its retail presence felt in Utah, New Mexico and areas of southeastern U.S. where its previously had “zero penetration.” That could mean as many as 400 new stores selling T-Mobile phones and service in the next 18 months, a 10% increase over its current retail store base.

This could open up many new markets to T-Mobile giving it access to potentially millions of new customers. Many of those customers, however, are already served by Verizon, AT&T and regional providers that have long prided themselves on bringing their networks to the U.S. hinterland. According to our fourth quarter data, Verizon is still by far the leader in national 4G coverage, providing an LTE signal to its customer 87% of the time. T-Mobile was closing the gap, though, and its 81% coverage was less than 2 percentage points away from matching AT&T in our report.

T-Mobile’s improving coverage and new stores definitely give it more tools to target these rural and small town customers, but there is a caveat. T-Mobile needs to build those networks well. Just throwing up towers along the interstate highways won’t cut it if T-Mobile truly wants to bring these new rural customers into the fold.

Instead of tracking geographic coverage, OpenSignal’s time coverage metric measures overall network availability. It calculates the percentage of time OpenSignal users can see a signal from a particular network, whether they’re indoors or out, whether they’re standing still on a busy street or driving through country back roads, and whether the network is crowded or relatively uncongested. Time coverage reflects the typical experience an operator’s customers see on a its network. Our data definitely takes rural coverage into account as customers roam about the country, but if an operator’s customers don’t live or work in rural areas they aren’t going to be spending much time trying to connect rural networks.

By expanding its sales presence into these previously uncovered territories, T-Mobile is taking a bit of a risk. These new small town customers will expect the same kind of network availability and reliability their big city counterparts see, and if its networks aren’t up to the task, T-Mobile’s rapidly improving time coverage might actually start suffering.

When we publish our next U.S. report in five months, we’ll have a much better idea of how much progress T-Mobile has made toward becoming the operator for all Americans. And if you happen to be a new T-Mobile subscriber in Utah, New Mexico or Southeast, we’d love for you to download OpenSignal’s smartphone app (available on Android and iOS) to help us track that progress.

This entry was posted in Comparing Coverage, LTE and tagged , , , . Bookmark the permalink.