T-Mobile's #GetThanked 'unlikely to have a major impact,' but high demand slows app downloads

Some financial analysts don't expect T-Mobile US to receive much of a bump in new subscribers due to its new Un-carrier 11 announcements, including its new Stock Up program. However, the carrier today reported "very high demand" for its T-Mobile Tuesdays app, and that demand appears to have affected some customers' ability to access T-Mobile's new offering.

T-Mobile yesterday live-streamed its Un-carrier 11 event, during which it announced its T-Mobile Tuesdays app that will allow customers to receive free gifts and to sign up for prizes. The app also allows each T-Mobile primary account holder to receive a free share in the company through the carrier's new Stock Up program. T-Mobile is promoting the new efforts under its #GetThanked hashtag.

However, based on the carrier's Tweets today, it appears that customer demand for T-Mobile Tuesdays is affecting some users' ability to download the app.

"Wow, you guys REALLY like to be 'thanked'! Very high demand on the app – we're working on it," T-Mobile tweeted today. "Crazy high demand is causing a few issues but we're on it!"

Despite that demand, the financial analysts at Jefferies wrote in reaction to the Un-carrier 11 event that "we believe the announcements are unlikely to have a major impact on subscriber trends. Furthermore, while the financial terms of the partner rewards were not disclosed, we anticipate only modest dilution. The impacts of Stock Up should be mitigated through open market purchases."

Added the Jefferies analysts: "Although the stock program could incentivize increased referrals and incremental net adds, we do not expect any major impact. We note, the structure was created to minimize dilution and therefore, we do not expect the company to issue additional shares."

Interestingly, the financial analysts at UBS also provided some metrics on the scope of T-Mobile's offerings. The analysts wrote in a note on the carrier's Un-carrier 11 event that the gifts and prizes available through the T-Mobile Tuesdays app can be accessed by 51 million T-Mobile customers, since it is available to both prepaid and postpaid T-Mobile customers (though not those who subscribe to T-Mobile's MetroPCS prepaid brand). "With most postpaid and prepaid customers eligible for this offer, we believe a combination of breakage (not every customer will do this) and wholesale discounts for T-Mobile will keep the cost in check, which management suggested is already reflected in guidance," the UBS analysts wrote.

The UBS analysts also noted that T-Mobile's Stock Up offering will be available to roughly 12.6 million T-Mobile customers since that program is only available to the primary account holder on the operator's existing consumer postpaid accounts. "Given phone ARPU of ~$47, T-Mobile is essentially offering one free month of service to customers but mgmt's guide for stable ARPU trends still holds," the UBS analysts wrote.

"We believe the company is aiming to drive customer loyalty, with churn improvements expected to mitigate the costs of certain rewards funded by T-Mobile," concluded the analysts at Jefferies.

Following the Un-carrier 11 event, T-Mobile executives said they continue to expect to score 3.2 million to 3.6 million branded postpaid net additions in 2016 -- a figure unchanged from T-Mobile's first quarter earnings conference call.

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