T-Mobile’s Business Push, Technology Advantages, and 5G Slicing with Daryl Schoolar

Full Transcript

Don Kellogg 0m10s

Hello, and welcome to the two hundred and fifty ninth episode of the Week with Roger, conversation between analysts about all things telecom, media, and technology by Recon Analytics. I'm Don Kellogg, and with me as always is Roger Itner. And this week, we also have Darrell Spooler with us. How are guys Hello.

Roger Entner 0m26s

We're good. Yes. A busy day.

Don Kellogg 0m29s

So gents, you're coming to us from the T Mobile Innovation Center. Tell us all about it.

Roger Entner 0m35s

Well, should we start with the morning of the

Guest Speaker 0m36s

Yeah, let's start with the morning.

Roger Entner 0m39s

The newly opened Executive Business Center. Yes.

Guest Speaker 0m44s

So T Mobile refurbished, improved, put some cool technology in with their executive briefing center, which is on their campus in Bellevue. And so they can very easily bring the executives over to show all the love and attention to large business customers and get

Roger Entner 1m9s

them over the hump. Absolutely. And it has, as you expect, the right amount of magenta color all throughout the building. Yeah. My initial impressions, I mean, it's new.

Roger Entner 1m20s

There's certainly things that they're working on still and that they were upfront about it. But when I look at it from the work that we're doing here at Recon, and one of the questions that we've looked at is how can T Mobile move upstream, move into say larger accounts, medium accounts, enterprise accounts. This is something that they talked about back on their capital days as well in November. And from what I've seen, I mean, challenge T Mobile has, there's kind of like three general areas where you can bucket the challenges that they're facing moving up there. There's relationship.

Roger Entner 1m53s

They need to build the relationship. They need to fight the incumbency relationships that most people already have. Two, there's still an ongoing perception about their network, coverage, capacity, performance, things of that nature, which takes a long time and repeated messaging to change perception. And a third perception, which I think in some ways is definitely a very standalone challenge is their reputation for working with large business. There is still a perception that they're not good at onboarding larger, and that is good dealing with larger.

Roger Entner 2m26s

So they're not as good as they

Guest Speaker 2m28s

Customizing type deal. There's some truth to it, right?

Roger Entner 2m31s

Certainly. But I think obviously the execs and what we saw today goes away to definitely address the relationship part. The part about inability to work with larger businesses. They showed definitely some thought leadership areas where they can do. They shared with us at least like one case example, which I think is always important.

Roger Entner 2m50s

It's one thing to say we can do x, y, z. Another thing to find some name beside it and say that we can do x, y, and z. So I think that was really good to hit on those two things. Honestly, they play up their best five gs story. That's not just tied to the executive sentiment.

Roger Entner 3m5s

You see that in all of their marketing.

Guest Speaker 3m7s

We saw that the rest of the day. Yeah. I think some of the things that were interesting that T Mobile shared on the record is that when somebody comes to the Executive Briefing Center, they're 80% more likely to sign up. What was interesting also was that they were very open that a lot of people are going to Microsoft and Amazon and then they also come by T The 80%, the question is, is it the people who made the effort to come are like predisposed to actually sign? Probably yes.

Guest Speaker 3m43s

How much does the executive briefing center help them? It helps. The question is how much? But they talked about that, if I remember correctly, the contract size of people who come there is like 26% higher. And the cycle time is like 15% faster.

Guest Speaker 4m2s

Yes. The other thing that was interesting and, you know, Daryl and I, you have been to more executive briefing centers than I can count. What I thought was very interesting that I hadn't seen before was that they had not only the briefing rooms and the boardroom style rooms, but that they also had like small little huddle rooms where like two people can like do a sidebar and can close the door where there's no table, but like in a more social setting. And they had, how should I say, a large living room setting where you can move into a casual interaction. And I think that's a really, really cool touch because it takes people out of their business frame of mind into more an interpersonal frame of mind.

Guest Speaker 4m56s

And in the end, I think you make sales a lot better when you like the people, when you are in a more casual way rather than when it's hard and dry numbers and you sit on this side of the table, we sit on that side of the table and it's us against you.

Don Kellogg 5m15s

Right. And that's relationship aspect of sales.

Roger Entner 5m19s

Yes. Very relationship. And

Guest Speaker 5m21s

and they explained to us that was very consciously done. And I thought that was a really cool new things that I hadn't seen in another Yeah. Executive briefing setup. So kudos there. And then we came over here to the, what is it now?

Guest Speaker 5m37s

Innovation Center. Innovation Center, different name, same building. Some of the same stuff, Yes. Interesting use cases. Yeah.

Guest Speaker 5m48s

Some of them I've seen three times before like Pano, still cool. Pano is their fire detection stuff. Yeah. And they've explained this, I don't know how many times. Still cool, but okay.

Don Kellogg 6m3s

I mean, guys, self driving cars, right?

Roger Entner 6m6s

Some had stickiness to T Mobile, some didn't. Yeah. But I mean, think, again, the good place to try to meet their objective, honestly, they think of this as a place for growing the ecosystem for. Think of this also in my mind is a little bit this is about like brainstorming where you get like the T Mobile folks highlighting the new technologies that they're bringing into the network like is probably gonna murder it, the new acronym L4S, I believe it's referred to. It's low latency, low packet loss.

Roger Entner 6m35s

And other technologies that they bring in slicing of course, to stimulate the conversation with the people that'll be developing applications or services on the network showing the new possibilities. But getting kind of an open dialogue going with also the different application developers as well, thinking about brainstorming.

Guest Speaker 6m53s

Here's my idea, your idea and then one plus one hopefully becomes three. Yeah, so they very nicely showcase the technology advantage that T Mobile enjoys right now. They're the only one in The US who have five gs advanced, which allows them for the L4s. They're the only ones who have announced slicing on a nationwide basis, even though I think we will see a lot more announcing The standalone core thing is like, from what we can tell, Verizon and AT&T are highly pregnant with that.

Roger Entner 7m30s

It's a temporary advantage that we'll eventually adopt.

Guest Speaker 7m33s

Yeah, but

Roger Entner 7m33s

But the question is to get the momentum now. And T

Guest Speaker 7m36s

Mobile does a very nice job here in that momentum.

Roger Entner 7m39s

And they launched the service today too in the business area that uses that engine slice the Super Business. Super Business, yes.

Guest Speaker 7m47s

Yes. And so that's a very nice combination of the standalone core slicing plus satellite, and then taking basically that key priority differentiation and taking it to businesses. I would expect them to do this then also to consumer because it allows them to then even more upsell a consumer. Especially for

Roger Entner 8m11s

what we saw with the L4s and the gaming.

Guest Speaker 8m13s

Exactly. Now the other question is how many people are doing gaming and do they have the money to game on a on a handset, right? We might be the wrong demographic for that. On a mobile handset, for sure. On a computer, speak for

Roger Entner 8m28s

yourself, I'm thinking the handset.

Guest Speaker 8m31s

Yeah, on a handset for sure. You know, I have to change glasses or I have to take off my glasses to see what's going on with my handset. So I like big screens, not little screens, but that's me. But yeah, no, and what's nice is T Mobile does a really good job to get the story out, right? There are about 20 analysts here, but it's not just an analyst event.

Guest Speaker 8m58s

They were way outnumbered. We are way outnumbered. We are like outnumbered five, six, seven to one by prospective customers, existing customers, developers. So they are doing a very nice job in doing that. The other guys at least haven't invited us.

Guest Speaker 9m19s

And from what I know they haven't invited the other guy, the other analysts either. So I think events like this have benefits and drive that store, right? It's always about a good story and talking about it. And T Mobile does a very good job in doing a good job and talking a lot about it. It's also a little bit kind of,

Roger Entner 9m43s

I'm trying to say the exact word, but when you think about the audience, so audience I would say mainly there probably was a lot of developers or some of the developers there trying to build the excitement around it showing, hey, here's some examples of things we brought to fruition. Here's how our partnership has been in front of them to continue to keep them energized and motivated to want to work with T Mobile. But at

Guest Speaker 10m4s

the same time, a lot of these applications will work on every carrier. Yes. Because on one hand, the carrier, it doesn't matter which carrier wants to be a captive audience for that one developer and the developer doesn't want to be captive to one carrier, they want to sell to everybody, not only in The US, but everybody in the world. Yes. And so it's a very interesting tension.

Guest Speaker 10m32s

And kudos to T Mobile that they didn't play their own center of the universe thing up too much, right? They're an enabler and a lot of the technology like they showed stuff about the sale GP where they're doing five gs slicing in number of harbors. Right now, they're the only ones who can do this. And so they play that nicely. So it was a good event.

Don Kellogg 10m59s

What's your take on how they're positioning Slicing vis a vis private networks? Because I always feel like that's one of the things that

Roger Entner 11m7s

Those are definitely two different things. Yes. They may be cousins, but they're not replacements for each other. Slice could be an extension of a private network, or you could build a slice into a private network, but they're not the same thing. But I'll say they didn't really talk about private networks No.

Roger Entner 11m23s

At all

Guest Speaker 11m24s

Well, Carrier wants to sell slicing. Maybe Verizon is talking about that they also run private networks. But I would say like, there have been more analysts reports written about private networks than there are five gs private networks. They're out there and the ones that are

Roger Entner 11m41s

out there are big, but they're not a lot of them. There's only so many harbors out there. There's so many only giant copper mines in the middle of the Australian Outback. Yes,

Guest Speaker 11m50s

and network slicing is something that will work for every business almost for every size. Yes. The barrier of adoption and the barrier of

Don Kellogg 12m3s

Well, one is infrastructure heavy and the other is completely virtualized, right? I mean, like that's the difference.

Guest Speaker 12m8s

Yeah, exactly. And businesses don't want to be infrastructure heavy. A business is not a network operator, right? Look at the company like ours, right? We outsource pretty much everything, right?

Guest Speaker 12m23s

We could run our own email server, but wherever we're going to put it, right? We buy it from Microsoft, we have cloud, we buy it from Google and from Dropbox, we have this and that, right? We could all do this ourselves, right?

Roger Entner 12m38s

Yeah.

Guest Speaker 12m38s

But then we would have to hire somebody, they would have to invest into hardware, all of that stuff. It's the same thing for five gs private networks. If you're an airport somewhere or if you're the military or if you that proverbial armor, sure. But if you're a say you're a store, you might want to have a private network for your customers. You're not going build a private five g network, right, in

Roger Entner 13m8s

in your store. And also, with the talk with reallocating where CBRS is, that's definitely going to put even more cold water on it for a lot of people, even if there was anything happening. Well, Just because the uncertainty of not knowing whether the radio you buy today will work.

Guest Speaker 13m23s

Well, here's the thing. If that actually happens, all of these people will have enough time to move and will get enough money to get a better system, whatever five, ten years later and say thank you very much the wireless carriers, I happily moved. And we had Tarazi here from Federated. He was like, yeah, we'll move, right? Because the reality is, you're getting a new network, and you don't even have to pay for it.

Guest Speaker 13m54s

Because by moving, you're getting new equipment, new software, new gear, and you're not stuck. And no, it will be. It will be. That at least that's what was offered. And Right.

Guest Speaker 14m5s

And usually you get more

Roger Entner 14m7s

I'm just too silly to No. I Yeah.

Guest Speaker 14m10s

No. Because Anyhow. Anyhow. Back to the point, there

Roger Entner 14m14s

was not a lot of private network talk here whatsoever. That's Yeah. What I'm

Guest Speaker 14m18s

So we have tomorrow more It's

Roger Entner 14m22s

an Analyst Day tomorrow.

Guest Speaker 14m23s

Tomorrow is an Analyst Day where we share our concentrated insights. But this has been a good day. We're very appreciative for T Mobile getting us here and we'll come again,

Roger Entner 14m37s

right? Absolutely.

Guest Speaker 14m38s

All right.

Don Kellogg 14m39s

Cool. All right, guys. Well, Roger, we'll talk next week.

Guest Speaker 14m42s

Talk to you next week.