Management Turnover as Change Agent

Wednesday, May 26, 2010

Lagging T-Mobile USA Opts for New Strategy And CEO

T-Mobile USA, which is owned by Deutsch Telekom AG (XE: DTE), the fourth place mobile phone carrier in the US behind Verizon, AT&T and Sprint, has finally opted for change. Early today the company announced that long time CEO, Robert Dotson, will be stepping down in February of 2011. In his place, the company appointed Philipp Humm to be the CEO-designate as of July 1. He will officially take over the CEO slot on February 2011. T-Mobile has continued to lag its key rPhilipp Hummivals in the United States and for some time now has needed a new strategy. Humm was previously the CEO of T-Mobile Deutschland from 2005 to 2008 and is currently the CRO of sales and services for Europe for Deutsch Telekom. He is well respected, understand the company and will bring new ideas to the table.Robert Dotson

It is about time T-Mobile got serious about its operations in the United States. The firm needs to be either acquired or come up with a new strategy to compete in the ever competitive wireless marketplace. The selection of Humm appears to make a great deal of sense. Currently, T-Mobile USA has falling subscriber numbers and increasingly poor service a combination for further problems. According to a story by Archibald Preushat for the Wall Street Journal T-Mobile USA,

… likely had the worst first quarter out of all the wireless players in terms of subscriber-base development. T-Mobile USA lost 118,000 contract customers, consistent with recent trends, but the number of net new prepaid customers fell 92% from the fourth quarter, a startling drop that shows the strength of some of the other prepaid players. Sprint Nextel, which continues to lose its more valuable customers, showed particular strength in its prepaid business. Deutsch Telekom One Year Stock Performance

We may see some changes before the official change over in February of next year. Investors must keep a close eye on all the upcoming management changes and possible strategy shifts. Stay tuned.

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