About this weblog

What you need to know: This weblog captures key data points about the global telecoms industry. I use it as an electronic notebook to support my work for Pringle Media.

Tuesday, March 26, 2019

The Cash Chasm in U.S. Telecoms

Although T-Mobile USA has made the U.S. telecoms market more competitive in recent years, it remains a fraction of the size of the big two: AT&T and Verizon. As the above graphic shows, in this decade, T-Mobile USA has generated less than 15% of the cash thrown off by AT&T, while Sprint’s operations have produced less than 12%.

In 2018, AT&T generated approximately $45 billion from its operations, bringing the total for the decade up to $334 billion. By contrast, T-Mobile USA is now generating about $8 billion a year from its operations, up from just $4 billion in the middle of the decade.

Those stats help explain why T-Mobile USA and Sprint are so keen to merge, ahead of the rollout of 5G. Individually, they are not generating anywhere near enough cash to invest in the next generation infrastructure required to challenge the market leaders.

The chart above is one of many in a high-level guide to the financial state of the U.S.’s top telcos. This new report enables long-term investors and policymakers to easily track the progress of the big four telcos - AT&T, Verizon, T-Mobile USA and Sprint - over the past nine years on a range of financial metrics.

The iPad edition is available here and the Kindle edition here.

Note, the above figures are based on the accounting methodology used by these telcos for most of the decade, but include estimates for 2018, when the industry switched to a new accounting standard.

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