T-Mobile aims to apply the “un-carrier” model that served it so well in the consumer space to the enterprise market.
T-Mobile ramped up its enterprise play in March with three solutions aimed at businesses and their employees and it’s seeing “excellent momentum” from that, according to a blog post by Mike Katz, EVP for T-Mobile Business.
The “un-carrier” says it’s already serving some of the biggest and best-known banks, energy companies and pharmaceutical leaders, and it’s got 60% of the national retailers.
Still, T-Mobile’s market share in the enterprise space is less than 10% while AT&T and Verizon predominantly serve the other 90%.
“There’s only one way to go but up,” said Bill Ho, founder of 556 Ventures. “They’re in a good place in terms of growth.”
Katz wrote that he’s confident T-Mobile will more than double its enterprise wireless market share during the next five years.
There are two ways to think about the enterprise market, according to Chetan Sharma, founder and CEO of Chetan Sharma Consulting. One is the number of lines or phones that are corporate liable, meaning the company pays for the service or the employee gets reimbursed through an expense report.
Both AT&T and Verizon are farther ahead in this arena. T-Mobile was never really in the game until late in the LTE cycle because its coverage was so poor, but with 5G, it has a lead for the next six to 12 months, he said. The corporate segment is more profitable than consumer, and contracts tend to last two to five years.
The other portion of the enterprise segment is the non-phone segment, meaning it’s going beyond basic voice and data connectivity. AT&T has the lion’s share of the connected car business, for example, and with both wired and wireless capabilities, it’s big in security services for global enterprises.
In fact, AT&T is leading in IoT and connected cars, as the biggest revenue generator in both those areas, Sharma said. Verizon is strong in the public sector, which also falls under enterprise.
5G for the win
Of course, all the operators are looking at the enterprise in 5G, whether for private networks, network slicing, edge and more. Verizon’s Network as a Service is another example of an enterprise play.
While T-Mobile is going to make a big push in the connectivity piece of the enterprise space, the part involving platforms and applications takes more time, Sharma said. For example, the connected car business involves SIMs, software and a lot of integration, and AT&T has been doing that for over a decade now.
“You have to build the vertical expertise in whichever domain you’re going after,” whether it’s automotive, retail or the public sector. “T-Mobile is starting to work on it, but that’s the tougher nut to crack because it takes time,” Sharma said.
It would seem that now is the time to strike. T-Mobile is “probably in the best position it’s been in its history,” he added, and its bet with the Sprint acquisition has paid off very well. The 5G coverage gap will start to narrow next year as AT&T and Verizon deploy their C-band spectrum. For now, T-Mobile kind of has a corner on the 5G market, and “they will try to make use of it as much as they can between now and next year.”