T-Mobile's Capital Markets Day

I had the chance of attending the T-Mobile Capital Markets Day in San Francisco earlier this week. Anticipation was building up over the last couple of months and the event didn’t disappoint.

Here are my observations from the event.

-????????? Industry nerds should watch Mike Sievert’s keynote in its entirety and then depending on interest double click on the details that other leaders focused on.

-????????? That T-Mobile is the number one operator in the world by marketcap is well known. The company has morphed from challenger to in TMO’s words – the champion. Once you reach the top of the hill, it requires a different set of skills than what got you there. T-Mobile seems to be making a seamless transition into the role.

-????????? T-Mobile has been beating their guidance consistently, quarter over quarter, year after year. When industry growth is a bit anemic, T-Mobile reasserted itself with strong guidance on Revenue (5%), EBITDA (7%), and FCF (8%) by 2027. These are amazing numbers.

-????????? T-Mobile has been leading in FWA subscriber base. As I mentioned in my opening keynote at MFF , FWA is the fastest growing service in the history of the industry. So, it was no surprise that T-Mobile upped its target from 7-8M to 12M by 2027. More pain for our friends in the cable industry. As I have been saying, waiting for spectrum to exhaust is not a sane strategy.

-????????? Deeper investments and targets for Fiber doubling down on the broadband story. Intense competition awaits.

-????????? There were also some explicit cost reduction and transformation targets which are quite impressive – 100% upgrades online, 50% activations online, reduction of call center calls by 75% (3M calls / week).

-????????? There was a lot of talk about using AI as an underlying layer to help achieve all of this and a partnership with OpenAI (Sam Altman was on hand to give more color) was announced. The learnings from this partnership could be quite groundbreaking and the ripple effects will be felt across industries.

-????????? The biggest announcement was that of AI-RAN alliance with NVIDIA , 爱立信 , and Nokia . This has several key components and looks quite promising. As I have said before, we are moving in the direction of compute running comms and this partnership could help accelerate that by a months and years. Lot of promise. The AI superstar Jensen Huang joined Mike Sievert to explain the vision and the implications.

-????????? I was delighted to learn that the seeds of this alliance were sown at our 2023 Mobile Future Forward. Very proud of the role that we play in facilitating groundbreaking conversations and partnerships. Immensely gratifying. Stay tuned for 2025 announcements ??

-????????? Ulf Ewaldsson talked about the granular network planning with the help of AI. Build the network where the customers are thus eliminating guess work. This is transformational on so many levels.

-????????? $9.5B guidance on capex spending. Pretty consistent investments each year.

-????????? US is sleepwalking into another spectrum fiasco if it doesn’t get its act together and modernize its approach and strategy.

-????????? T-Mobile has a $1B ad business. This would be at least $10-20B marketcap company in public markets. 4th Wave at work.

-????????? Callie Field talked about how the Enterprise business is showing a nice uptick of double-digit growth every year with more to come.

-????????? TPriority for First Responders using network slicing.

-????????? IntentCX – using AI to understand and interact with customers on a 1-on-1 basis – holy grail for engagement.

-????????? The convergence question and impact on future M&A was hanging in the air.

It is worth double clicking on the blockbuster AI-RAN announcement

·???????? As I mentioned earlier, there is an inevitable shift towards RAN running on compute, but it is not as trivial as it sounds. That’s why the four companies are coming together to iron out the frameworks and architectures which are likely to influence the 5GA and 6G standardization process. I talked about it in more detail in my MFF opening – AI Infrastructure is in the process of being built out and the players active in the journey will benefit tremendously. The goal is to maximize capacity utilization and RAN performance while building new business opportunities on top. Essentially, the AI-RAN becomes a platform just like data has been a platform for growth and disruption. The platform can self-tune in real-time, assist application and AI workloads by third parties in ways that was not possible before. This can reduce the cost by a significant factor as well as open up opportunities for those bold enough to take them.

·???????? Traditional networks are under utilized and over provisioned especially by the western operators (Operators in India run their networks at a very high utilization and as such their ROI per site is higher). AI-RAN platform is very elastic and can lead to 2-3x better utilization.

·???????? This will be quite disruptive in more ways than you might think of right now, but the journey has started.

·???????? Industry faces its “horses or automobiles” moment

Overall, a fantastic day of insights, announcements, and seeing friends from the industry.

Congrats to the senior leadership teams at T-Mobile, Nvidia, Ericsson, Nokia, and OpenAI for all the work that went into the partnerships and announcements. Also, the behind the scenes crew who made it all come together.

Ankur Kapoor Soma Velayutham Tim Petersen Jean-Francois Lacasse Christian Fasulo Ronnie Vasishta Adnan Boustany Jeff Giard John Saw Ron Marquardt Henry Chalian Chris Penrose