T-Mobile USA is putting resources from its competitor to good use.
The Bellevue, Wash. company, the fourth largest wireless carrier in the U.S., announced plans to build a new $4 billion Long-Term Evolution (LTE) wireless network. The cost is the same as the breakup fee that AT&T (NYSE: T) was required to pay its parent, Deutsche Telekom , following a failed $39 billion merger deal.
A new network will give T-Mobile customers higher data speeds. The plan calls for installation of 37,000 cell sites and repurposing the use of wireless spectrum. T-Mobile received $1 billion of spectrum from AT&T along with $3 billion in cash.
We want to be known for delivering the best value in wireless because of the advanced technology we deliver at an affordable price, Philipp Humm, CEO of T-Mobile USA said in statement. Over the next two years, we're prioritizing and investing in initiatives designed to get T-Mobile back to growth in the years ahead - beginning with the transformation of our network.
T-Mobile expects LTE to be available to the vast majority of the top 50 markets in the U.S. by 2014. It didn't give exact figures.
The late entry into LTE comes as T-Mobile announced Thursday it shed 526,000 subscribers in the fourth quarter, including 802,000 net losses on contract-based plans, which generate larger revenue. The fallout was attributed to the provider's failure to carry Apple's iPhone. Sprint Nextel, which competes with T-Mobile for price-conscious customers, began selling the iPhone in October.
AT&T and Verizon Wireless have already rolled out LTE, while Sprint announced recently its intentions for a rollout.
American Depositary Receipts of Deutsche Telekom fell 35 cents to $11.60 Thursday afternoon.