Consumers are flocking to T-Mobile’s 5G home internet service — to the point where it’s become one of the largest internet service providers in the nation after just two years.
But would T-Mobile slow that growth down by raising prices? Maybe.
Speaking to investors on a Thursday earnings conference call, T-Mobile CEO Mike Sievert hinted at the prospect with a vague term, “optimization,” which is financial jargon for potentially adjusting prices higher to maximize profitability and shareholder value.
But why would T-Mobile want to slow the growth in its 5G home internet business? The company projected a goal of serving 8 million subscribers with its 5G home internet service, using the excess capacity in its network. Any more, and T-Mobile would have to invest money into the network to support additional customers. The company hasn’t made a decision on whether it wants to do that, so it could potentially hit its limit in the next year or two.
Given that T-Mobile has been growing even faster than its own expectations, it wouldn’t be surprising if T-Mobile took advantage of the heightened demand and raised prices. The company earlier this month eliminated the promotional pricing of its service and reverted back to the standard price of $60 a month, representing a $10 price increase.
It’s not the first time Sievert has hinted at price increases. In December, he told investors at a UBS conference that he was open to tinkering with pricing.
“You might see us experiment with rate vs. volume dynamics over this next year,” Sievert said. “We want to make sure we add the most possible value to the business.”