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MetroPCS VoLTE Plans On Track for 3Q

Thu, 07/26/2012 - 7:57am
Maisie Ramsay

MetroPCS is confirming its plans to launch an LTE-based voice service in the third quarter after pushing out its debut earlier this year.

"During third quarter, we plan to introduce the first VoLTE handset," CEO Roger Linquist said during the company's earnings call today. 

The company had originally planned to launch VoLTE in the first quarter, but later said it would be delayed until the second half of the year. Comments from MetroPCS executives today indicate the service is now on track for launch this quarter.

MetroPCS upcoming phone will be the first in the U.S. market to feature VoLTE. Other operators including AT&T and Verizon Wireless also plan to move to VoLTE, but their deployments are expected to come much later than MetroPCS. 

Moving to VoLTE is critical for the spectrum-strapped prepaid operator, as it will allow spectrum currently being used to support legacy voice services to be repurposed for its LTE network. 

The next-generation mobile broadband service is expected to allow it to compete more effectively against companies like Cricket Communications and Sprint prepaid brands Boost Mobile and Virgin Mobile USA. 

"By the end of the year, most of our markets will be LTE-ready with 5x5 spectrum," Linquist said.

But MetroPCS' efforts to move customers off its legacy network onto LTE have been stymied both by the lack of voice capabilities but also by a dearth of affordable LTE smartphones for its cost-conscious subscriber base. 

The company may make some progress on that front in late August, when COO Tom Keys said it expects to begin selling cheaper LTE handsets priced at $99 and $149. More LTE smartphones at other price points will come later this year, he said. The device launches will coincide with MetroPCS' kickoff of its "LTE for All" campaign in the third quarter. 

Linquist said that MetroPCS is also focused on developing Rich Communications Suite voice and data services this year to build on its VoLTE capabilities and to help MetroPCS "differentiate itself from other MVNO's and other service providers" by giving its prepaid customers access to postpaid-style services. 

"We're aiming to be the best deal in town" for LTE," Linquist said.

MetroPCS' closed the second quarter with more than 700,000 LTE subscribers comprising about 8 percent of its customer base. Overall, it lost 186,000 net customers last quarter. 

Churn fell 50 basis points year-over-year to 3.4 percent, while ARPU increased slightly to $40.62. 

Profits jumped 77 percent to $149 million on sales of $1.6 billion. The number sent MetroPCS' stock soaring in morning trading, and it climbed nearly 35 percent to $8.46 by 11:30 a.m. Eastern.

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