T-Mobile Wins The Quarter

AT&T, Verizon, Sprint Maintain Customer Bases

Consumer Intelligence Research Partners (CIRP) released analysis of the results from its research on mobile phone companies for the calendar quarter that ended December 31, 2014. This analysis features findings about consumer trends in mobile phone activations from October-December, 2014 for AT&T (T), Verizon (VZ), Sprint (S), and T-Mobile (TMUS).

CIRP finds that among major mobile phone companies, T-Mobile had the best quarter, combining retention of existing customers and gaining new customers from other carriers.

Based on our analysis of customer activations, we identify customers that renewed contracts with a previous mobile carrier, customers that switched carriers, and first-time mobile phone buyers. This analysis shows that among customers that activated a phone during the quarter, T-Mobile grew its customer base 29%, relative to the number of customers that started the quarter as T-Mobile customers (Chart 1).

Chart 1: Carrier Share of Phone Activators at Start and End of Q4-2014

We take a quarterly view of loyalty and churn, focusing on customers who activate a phone within the quarter. T-Mobile started the quarter with 10% of the consumers in our quarterly survey of phone activators, and ended the quarter with 13%. This 29% increase in share of this quarter's phone activators is consistent with the recent T-Mobile announcement that they added about two million customers. Based on these shares of customers retained and switching during the quarter, we estimate that Verizon had the next largest number of customer additions came at about 1.1 million. The other large national carriers each added under 1 million customers.

Change in share for the quarter consists of customers that switched to or started with a carrier, minus those that switched away from that carrier. T-Mobile attracted new customers equal to 39% of the phone-activating customers it had at the start of the quarter. T-Mobile also lost 18% of its customers that activated a phone during the quarter. T-Mobile also attracted first-time phone buyers equal to 8% of its customers at the start of the quarter (Table 1).

Table 1: Customer Gains and Losses by Carrier - Q4 2014

AT&T had the most loyal customers, retaining 88% of those that activated a phone during the quarter. However, AT&T did not attract as many new customers as a percent of their base at the beginning of the quarter. Relative to its base, T-Mobile attracted the highest percentage of new customers in the quarter, though they also a greater percentage of existing customers than Verizon and AT&T.

While the four leading carriers do trade customers, as a group most of their growth comes at the expense of regional and pre-paid carriers," said Levin. "The regional and pre-paid carriers retained a much smaller percentage of their customer base, and attracted a smaller percentage of new customers from other carriers, as well.

CIRP bases its findings on a survey of 500 US subjects, from January 1-13, 2015, that activated a new or used phone in the October-December 2014 period. For additional information, please contact CIRP.

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