Is T-Mobile Going Out of Business? The Chances are 50 – 50
There seems to be a lot of concern going around about T-mobile going out of business, but what exactly is the truth? Read on…
Previous CEO and President Phillip Humm announced in March 2012 that seven of their 24 call centers would be closing down in Kansas, Oregon, Florida, Colorado, Texas, Pennsylvania and a few other places. Because of this move, over 3,000 employees are expected to be out of work.
However, Phillip comments that the remaining call centers would try to fill over 1400 positions. While many people will still be out of work, the company tries to comfort the affected employees by giving them a severance pay and of course, support for relocating. The reason for the consolidation lies partly on the cost configuration of the company.
The company’s customer foundation and their call capacity must align with this configuration, and according to Phillip; this move will assist with that task. This type of change will cost them an investment of over $4 billion, and even though their attempt to join together with AT&T failed, they are focused on merging with an outplacement firm which will allow them to improve their network.
T-mobile is one of the largest wireless providers in the world (4th place), but with AT&T and Verizon constantly investing into their network deployment, T-mobile find themselves falling behind. Due to the loss of customers and sales, they cannot afford to invest as much. Even the $4 billion invested may not be enough to keep them in the race.
The outplacement firm that T-mobile is bringing forth will help many people obtain career assistance at those seven facilities being shut down. Individuals will be able to access tools for job searching, training and their very own career coach. On top of that, continued health insurance through COBRA will be paid for an extra two months. While the company searches for a new CEO, many worry that this change could affect T-mobile’s plans for the future.
The new strategy of the company or the legacy of Humm should be given a shot whether a new CEO comes in or not. It would be a shame to put the idea away before it has even had the time to present results. The future LTE network that T-mobile brings is far from what its competitors are dishing out, but T-mobile is working extremely hard to see that it positions them where they need to be.
Not to mention, T-mobile has a lot of options. Considering they realized in early 2012 that they had already lost about 500,000 customers or more and over 800,000 that were on contract type plans, the company is more than ready to launch the LTE in 2013. It was clear that once the iPhone was launched with AT&T, Sprint and Verizon, giving them an increase in sales; T-mobile had to do something.
Not to mention, T-mobile was having a difficult time before its competitors even started offering the iPhone. However, its entrance into the wireless world surely did not help.