After completing our bi-annual set of enterprise mobility briefings from the four major U.S. mobile operators, it is clear to Current Analysis that they are separating into two “camps”
- AT&T and Verizon (while also having SMB and mid-market product strategies) have their eyes primarily focused on the enterprise, and increasingly, the MNC; Sprint and T-Mobile may dabble a bit in all segments, but now state overtly that their sweet spot is the SMB and mid-market customer
All four major U.S. mobile operators can theoretically attract business customers of all sizes and verticals, including MNCs with U.S. operations. While perhaps it has been obvious all along, however, Sprint and T-Mobile are now very clearly stating that they are really targeting the SMB and mid-market customer. They may attract an enterprise here and there but these deals are more opportunistic. Making this clearer is actually helpful – it is not fair to judge Sprint and T-Mobile against AT&T and Verizon for successfully drawing a large enterprise or MNC customer base. Sprint and T-Mobile lack not only the fixed line infrastructure (although Sprint still has a global MPLS network and offers U.S. wireline services such as Ethernet and IP VPNs) but they lack the resources relating to large managed and professional services groups, significant hosting infrastructure, global sales personnel, giant global data centers, managed security services, deep vertical expertise, consulting etc.). In fact Sprint and T-Mobile are proud of this positioning. T-Mobile’s disruptive ‘Un-carrier’ strategy centers around the shaking up of the industry with programs that include the removal of annual contracts, the end of global roaming charges, free tablet data, paid-off ETFs from other carriers, and a growing set of innovative price plans and services. Both Sprint and T-Mobile still offer unlimited data plans and Sprint is building out not only 4G LTE, but its own superfast version that leverages its three spectrum bands.
In the business market, both T-Mobile and Sprint have recently noted that they are rarely the primary carrier in a deal with a large enterprise and that it is hard to compete with AT&T and Verizon who have long-term contracts, deep volume discounts and a wealth of fixed line services to offer large enterprises in addition to diverse mobility solutions. T-Mobile has favorable international pricing due to its current status as a DT subsidiary and member of FreeMove but admits it is not likely to be the primary carrier in an international deal. So perhaps it is time to stop viewing all four carriers under the same lens. If T-Mobile and Sprint merge, it may be messy for a while (although SoftBank will try and smooth the edges of such a union) but at least the two carriers are on the same page in many ways. They look for simplicity in pricing and portfolio, and push solution bundles rather than a larger and more diverse portfolio of fixed, mobile and converged services.