Q.&A.: T-Mobile's Chief on What's Next After Failed AT&T Merger LAS VEGAS - For several months in 2011, the wireless carriers T-Mobile USA and AT&T were pursuing a merger to unify their networks and expand their businesses. The deal ultimately collapsed after facing resistance from governmental agencies, which raised antitrust concerns. Now the big question is what's in store for T-Mobile, a wireless company that has struggled while rivals snatched away subscribers with popular devices like the iPhone and speedier network technologies. In an interview, Philipp Humm, T-Mobile's chief executive, shared his vision for the company. Q. The proposed merger with AT&T has collapsed. What's next for T-Mobile? Mr. Humm: We got $3 billion in cash from the breakup, and that is a big kick-start to improve our later coverage, and we've got some interesting roaming arrangements with AT&T. These are real assets we're going to capitalize going forward. We continue to invest heavily in our business. A few highlights: The first one is we invested massively into our operations, our sales. We added another 250 stores, and modernized 700 - redesigned them to be more customer friendly. We're able to strengthen our strategic relationships with Walmart and Sam's, and we've formed new retail partnerships as well, such as Toys "R" Us. We keep on improving our 4G network. We still have the biggest 4G network. We keep on working on strengthening the asset base, and last but not least we continue to invest in new rate plans. We've launched the unlimited value plans for $49.99, we launched 4G for the prepaid arena. Our prepaid customer base is now growing for us 70 percent year over year. Over all we've kept quiet, but we've kept on working on strengthening our brand and now we're getting ready to really restart the brand. With all that said, we're not disclosing everything at C.E.S. We're finalizing our plans and we should disclose most of it in this quarter. Q. Is T-Mobile still positioning itself to be acquired? Mr. Humm: As you've seen, there is no possibility for a second AT&T deal in the U.S. market, so I think that answers the question on its own. Deutsche Telekom understands that the best thing that it can do is strengthen the value of its U.S. business. D.T. will look at ways to do that and find financing possibilities to overcome its own financial limitations in the European and U.S. market. There is a vital interest in the U.S. business. Q. Some analysts have said that if T-Mobile simply carries on with its business, it will run out of money in two years. Is that an accurate prognosis? Mr. Humm: If you compare ourselves to some direct competitors like Sprint, we're running on pretty healthy profits. I don't know how we should run out of money with this profitability. Q. Then why was the proposed merger with AT&T necessary in the first place? Mr. Humm: We are in a scale market, and long term there is a rush now to bundle from a scale point of view to gain access to spectrum and the network. That's a good rationale for a deal and an infrastructure for the market. Q. The entire wireless industry faces a spectrum crisis. What is T-Mobile going to do about this? Mr. Humm: It is not in an immediate spectrum crisis. We got some significant gain from the deal-breaker, which we obviously are going to use to further strengthen our holdings. We are working on ways to make our spectrum available to our customers. More to come as the quarter progresses. There are many possibilities for D.T. to overcome financing issues, so they're working on it on a shareholder point of view. It's important that we have a parent who helps us in restarting our business. Q. 4G and LTE aren't the same technology, and other carriers are betting heavily on LTE. Does T-Mobile have an LTE deployment strategy? Mr. Humm: In my personal opinion, the LTE topic right now is in the U.S. completely overhyped. If you look at it from a consumer point of view, do you think there's going to be a difference between if you're on 4G or LTE? Take the iPhone today: it's on Sprint CDMA and Verizon CDMA and AT&T GSM. And so it's far away from being on 4G, but it's quite a successful device. The point I'm simply making is that from a consumer point of view, LTE is irrelevant at this point in time. It's not something that's immediate in its need, and that's why we're a little bit relaxed on the LTE front. But we'll have more to say about LTE when the time has arrived for it. More to come. Q. Speaking of the iPhone, is there any hope that T-Mobile will get the iPhone? Mr. Humm: First, T-Mobile has AWS as a band, globally speaking a very specific band. In the past we were not on the chipset for the iPhone. But chipsets are evolving so they can carry more bands, and AWS is becoming more mainstream with the advancement of LTE devices. We expect that over time, the band will be less of an issue. That being said, whether we do or don't get the iPhone is probably a question to address to Apple. Q. What's 2012 looking like for T-Mobile? Mr. Humm: We really have established ourselves as a value player in the market. Second, we have a very strong 4G device family, which we'll continue to evolve. We'll announce the Samsung Blade, and soon the Lumia 710. There will be more devices coming up. I think the important thing for us is to bring 4G to the customer. T-Mobile does more than it is credited for, like we have very strong 4G services. ... Our TV usage is growing more than 700 percent. We have a fantastic photo album service, which is completely backed up in the cloud, and completely backed-up address books. There are many things we offer to our customer, and we now need to make sure this is being understood. Then 4G really comes to life. 4G is not just about communication or browsing the Web, it's much more than that. What we will also do is continue what we've started: a complete remodel of all our stores to make sure there is full consistency in the brand, as you see it in the advertising and the stores. I think from our side we're back on the market in fighting strength and fighting spirits. So we're looking forward to a good 2012.