Mobile US market at a glance, as seen by a non US resident. Mobile subscribers growth is slowing down, but there are still large opportunities to catch. Mobile Carriers are rolling out 4G network in order to provide the best service to the customers, increasing data usage, loyalty and ARPU. Competition on services, such as Video, contents and Communication with OTT can provide further revenues. The Prepaid segment is the fastest growing, and catch attention of all the carriers. Carriers exploits all smartphone and tablet potential, waiting for an explosive growth of Internet of Things. Any comment is welcome.

1. US MOB ILE MAR KE T
August2013
IS THE GR O W TH O V ER?

2. 335million mobile subscribers
317million
Source: elaboration Carriers investors 31 December 2013 - Difference is due to multi SIM owner, 3G/4G tablets and modems, and M2M internet of things
US Demographics

3. A traditional business model
Carriers
Network
Supplier
Distribution
Brand
People
Service plans (Data, Min, SMS)
Devices
$$$
Revenues from
plans/device
Carrier
reinvestment
US market
$200B
Customers
335M

4. Sprint lost subscribers
because of the Nextel
network shutdown
T-Mobile boost
subscribers in 2013 as
result of merge with
MetroPCS
110
Customers by Carrier (million)
103 4754
Source: elaboration Carriers investors 31 December 2013 - figure includes MVNO and M2M SIM Cards
4 Carriers provide nationwide service

5. 4 Carriers control +95% of the market
Source: ISTAT 2011, Source: AGCOM Quarterly Telecommunication Markets Observatory 31 December 2013
Market share by Carrier, Q4 2013
335M
Source: elaboration Carriers investors 31 December 2013
customers
32%
17%
14%
34%

6. Carrier Revenues continue to grow
Total revenue +7% YoY, with T-Mobile +24% YoY
0
63
125
188
250
2011 2012 2013
2420
21 323230
817670
706763
ATT Verizon Sprint T-Mobile
+5%
+7%
+0%
+24%
YoY
Source: elaboration Carriers investors 31 December 2013

7. Creating new mobile subscribers
is becoming more and more difficult:
carriers are stealing customers from one another
Source: elaboration on Carriers investors 31 December 2013

8. 4G !
LTE
SERVICES
& LTE
PREPAY DEVICE
but there are still opportunities to grow

9. an important driver to increase ARPU
4G !
LTE
SERVICES
& LTE

10. One of the most advanced LTE markets
50%
US users on LTE plans
11.5MbpsAverage download speed
on T-Mobile
83.2%
Network coverage with Verizon
Source: data from opensignal.com , in the picture:T-Mobile 4G coverage

11. Carriers offering more services
VOICE
& MESSAGING
DATA
VIDEO
SERVICES
Better experience, better network, video services
to increase data usage and ARPU
FIXED
BROADBAND
INCREASE ARPU

12. But only a part of the value is captured
Carriers, competing with OTT, offering owned and 3rd parties services in
order to capture more value in the chain
CONTENT
PORTALS
CONNECTIVITY
DEVICES
DISTRIBUTION
e-com
Ads
Software
Network

Device
Ads
video
denote core business
over the top

13. a new way to look at Prepaid Market
PREPAY

14. Cheaper option for
price-sensitive target
!
More flexibility
Postpaid market
saturated
!
Subsidy reduction
Growing popularity of Prepaid plans

15. We can't keep doing big
subsidies on phones
!
Randall Stephenson
AT&T Chairman & CEO
Source: AT&T conference December 10, 2013

16. Prepaid is the fastest growing segment
Prepaid plans account now 17% of the Market with +30% YoY
0
68
135
203
270
2011 2012 2013
44
3432
222215212
Postpay Prepay
+3%
+30%
Source: elaboration Carriers investors 31 December 2013

17. We are going to redefine a
stupid, broken, arrogant
business
!
John Legere
T-Mobile US President & CEO
Source:T-Mobile conference March 2013

18. T-Mobile reshaping Prepaid Market
Carrier offering plans without annual contract, with simple, pricing and
optional device (“Un-Carrier”program, March 2013)
Service Fee Prepaid / Postpaid
Device Upfront + Installment Fee (24 mo)
“Un-Carrier”way
Upfront + Monthly Fee (24 mo)
Industry norm
POSTPAID PLAN
DEVICE SUBSIDIZED
CONTRACT TERM 24mo
SERVICE PLAN AND DEVICE SEPARATED
BRING / BUY / FINANCE YOUR DEVICE
NO CONTRACT
+
*
*

19. DEVICE
smartphone market still healthy…
while waiting for Internet of Things

20. 65%
of customers own a Smartphone
87%
of new phones are Smartphones
Source: COMSCORE reports December 2013 US, eMarketer statista.com
140 Mln Smartphone sold in 2013
There is still market left for new and for upgrade (cycle 18-24 month)

21. Source: Counterpoint market research, Q1 2014
Apple leader in the Market
There is still market left for new and for upgrade (cycle 18-24 month)
Apple Samsung Motorola LG HTC Other
42%
iPhone market share

22. Apple dominates in 3 Carriers over 4
SMP market share by Carrier, Q1 2014
Apple Samsung Other
Source: Counterpoint market research, Q1 2014

23. Family plans and shared data with
cellular tablets and other devices show
positive results but explosive growth takes
time for the IoT ecosystem to build out
and prices to go down
Source: Chetan Sharma Consulting market research, Q3 2014

24. Early Upgrade plans to reduce churn
T-Mobile early upgrade plane JUMP!, followed by AT&T, Verizon and
Sprint, drove incremental postpaid customers and reduced churn
1. Buy a phone and finance it through T-Mobile
2. Enroll in JUMP! for $10/mo
3. Trade in your eligible device at any time
4. Select a new device
Source: elaboration Carriers investors 31 December 2013
T-Mobile upgrade program

25. thanks
designed by
stefano catracchia