MetroPCS loses 300,000 customers, launches joyn

Third-quarter earnings results from MetroPCS have provoked a mixed reaction, with growth in net income and revenues but a fall in average revenue per user (ARPU) and accelerating customer losses.

Net income for the fifth-biggest mobile-phone operator in the US was $193 million, compared with $69 million during the same period last year, but included a securities settlement of $53 million.

Total revenues grew by 4% to $1.26 billion.

Third-quarter earnings results from MetroPCS have provoked a mixed reaction, with growth in net income and revenues but a fall in average revenue per user (ARPU) and accelerating customer losses.

Net income for the fifth-biggest mobile-phone operator in the US was $193 million, compared with $69 million during the same period last year, but included a securities settlement of $53 million.

Total revenues grew by 4% to $1.26 billion.

Despite these improvements, the operator reported monthly ARPU of just $40.50, a decrease of 30 cents since the third quarter of 2011, and net subscriber losses of 312,291, compared with 69,384 additions a year earlier.

Those aspects of its performance look particularly disappointing given that MetroPCS (Richardson, USA) has managed to sign about 12% of its 9 million customers up to LTE services, which operators see as a means of defending and even growing their revenues.

MetroPCS blames the decline in ARPU on its use of promotional service plans.

The numbers also show that MetroPCS is falling even further behind AT&T (Dallas, USA) and Verizon Wireless (New York, USA), the country’s two largest operators.

Last quarter, AT&T and Verizon added more than 1.5 million contract customers to their totals. Both operators also report ARPU of more than $55 a month.

Some analysts have blamed the shortcomings of MetroPCS on the poor quality of its network, which provides patchy coverage compared with those of its bigger rivals.

A proposed merger with T-Mobile USA (Bellevue, USA), the country’s fourth-biggest operator, would do little to improve the situation because the two operators’ networks are largely overlapping.

Still awaiting regulatory approval, that merger would, however, create an entity with more LTE spectrum than either AT&T or Verizon in several important markets, allowing it to provide higher-capacity ‘4G’ services.

In the meantime, MetroPCS is hoping its launch of joyn services, announced shortly after the earnings announcement, will help it to attract new customers.

MetroPCS claims to be the first LTE operator in the world to launch joyn, the brand name for services based on the RCS (Rich Communication Services) 5.0 standard promoted by the GSM Association.

Its joyn offer includes features like content sharing and WiFi and video calling.

“We believe RCS is a tremendous differentiator among prepaid and postpaid competitors alike and recognise that achieving interoperability across US 4G LTE network is the next key step to paving the way for more innovative services and capabilities in the future,” said Roger Linquist, the chairman and chief executive of MetroPCS, in a statement.