Interview: T-Mobile CEO Philip Humm Embraces Role as Challenger to Verizon, Sprint and ATT
When Philip Humm meets with the other CEOs of T-Mobile subsidiaries, he is often the odd man out. While the others can boast of their 30 percent market share and compare notes on how their iPhone is selling, Humm can’t really relate.
T-Mobile has a fraction of that market share and no iPhone to speak of. Instead, T-Mobile USA is trying to operate as a feisty underdog. It’s a role that Humm said he not only relishes, but one that is also a natural fit for his company, which was born with the 2001 acquisition of VoiceStream, a scrappy regional carrier.
“The organization is going back to its roots,” he said in an interview last week. “VoiceStream and later T-Mobile really started in the market as a challenger. They started with big buckets of minutes at the time and later with unlimited minutes. These are things which, in a sense, are coming back now.”
While Verizon and AT&T are shifting away from unlimited plans and Sprint is hiking the cost for smartphone data rates, T-Mobile says it plans to offer lower rates in an effort to win back market share. From its $10 entry-level data rates to unlimited family plans that can save hundreds of dollars per year, Humm said the company is putting its money where its mouth is.
“We are a very good value,” Humm said.
But before Humm can win over customers, he knows he must start with the company’s own employees, some of whom became disenchanted as their company saw itself slow to move to faster networks and embrace the latest technologies.
Humm is currently traveling around the U.S., spending each Wednesday through Friday from now until April meeting with workers in different key markets.
“In the beginning of the week I pick up my job slip from my assistant,” he said. “[I learn] ‘Where do I have to fly this week?’” Last week he stopped in San Francisco, San Jose and Los Angeles. This week he is due in Texas.
In each city, Humm outlines the plan and shows off the company’s combative ads, which feature a young man as the iPhone, hobbled by the slow speed of its networks. T-Mobile, meanwhile, is a beautiful young woman, riding fast and free on T-Mobile’s network. So far, he said, the message has resonated with the company’s employees.
There is more to do than just cut prices. In the absence of an iPhone, T-Mobile needs to do a better job of embracing Android, he said. And that doesn’t necessarily mean doing a lot of customization work, as it and others have tried to do, or spending a fortune building its own brand, as Verizon has done. Humm said that T-Mobile can have a good Android strategy, in part by just being open and quickly adopting the work done by Google and others.
“It is key for us to maintain the strong relationship we have with Google and to be very fast with Google, testing and then launching improved operating systems,” Humm said. “I don’t think it is our most important duty to really tailor all the things in a complicated way.”
One of the areas for improvement in the market is just staying current with Google, both with new updates and in offering timely upgrades for existing customers. The company is in the process of launching a new program called Reinvent, Humm said, that will do just that.
T-Mobile is also working aggressively to speed up its networks. Although it lacks the spectrum to immediately move to an all-new technology like the Long-Term Evolution network being adopted by Verizon and planned by AT&T, T-Mobile is working quickly to roll out faster versions of its existing network. That solution may only be a stop-gap, but it can offer some pretty good speeds for the next couple of years, anyway.
“I do not see a reason why a customer should not have two devices minimum,” Humm said. However, that is tricky when doing so requires two separate data plans and tablets require customers to plunk down $500 or $600 on top of whatever they paid for their smartphone. Lowering the up-front and monthly costs is key to broad adoption of multiple cellular-equipped devices, Humm said.
And it’s not that Humm wouldn’t like one of the options to be an iPhone.
“We never said that we would not like to have an iPhone,” he said. “We think the iPhone is a great and iconic device.”
He notes that the company has been very clear to go after the companies offering the iPhone and their networks, rather than against the iPhone itself.
“The potential of the iPhone is by no means realized on the network it is running,” Humm said, adding that things won’t improve when it comes to Verizon because it will run only on that carrier’s older CDMA network.
As for when or if the iPhone might ever come to T-Mobile USA, though, Humm has no answers.
“It really is a question to ask Apple,” he said.