T-Mobile CEO thinks it's 'hilarious' that Verizon bought Yahoo: 'Oh my God - it's a mess'
In a recent interview with T-Mobile US CEO John Legere, Business Insider asked him what he thought about competitor Verizon.
Legere said the company was even more "befuddled" than AT&T, the other half of his competitors that he's dubbed "dumb and dumber."
He said Verizon's acquisition of "iconic 1990s internet companies," referring to AOL last year and Yahoo this year, "and a leadership shift that's going on now, with two or three aggressive people who are all vying to crawl into Lowell McAdam's CEO chair," and said the situation was "hilarious."
"Like, oh my God, you not only bought Yahoo, but they're a mess before you brought them in," Legere said. At the time of the interview, it had been revealed that Yahoo was the victim of perhaps the largest hack in history, with as many as 1 billion users affected. It had not yet been reported that, according to Claire Atkinson of the New York Post, Verizon is reconsidering its pending $4.8 billion acquisition deal and wants a $1 billion discount. This is on top of declining revenues across all major Yahoo segments during CEO Marissa Mayer's tenure since 2012.
Legere explained further that he understands why Verizon moved to acquire Yahoo, but that even if the acquisition went smoothly, wireless customers should see it as a sign that Verizon is juggling too much to improve its wireless business.
"Now I do know, respectfully, underneath that, there is an advertising and a customer-information component to the deal that is very valuable, one that most people don't look at really why they're buying these things," he said. "But it's not the real business that they're in. So in the meantime, again, wireless is not really where they are. They lost the headline "We're the best network," and they're fighting desperately to capture it back, spending a lot of money."
Legere also had words for the rest of the Big Four wireless carriers in the United States. For reference, using Q2 2016 data for US wireless customers, Verizon has 142.75 million, AT&T has 131.81 million, T-Mobile US has 67.38 million, and Sprint Nextel has 58.45 million. T-Mobile overtook Sprint as the third-largest US carrier in 2015.
AT&T
"AT&T basically hasn't added a postpaid customer on the voice side since Q2 of 2014! If I hear one more time that in two quarters their over-the-top offers are coming out and life's going to be grand ... it's to protect and defend their profit streams and play a different game in the future. But every now and then we get their attention, and then they decry us, and then it's 'me too,' but it's too late, and then it shifts.
"They refer to customers as units of acquisition. They just don't get it. The guy that runs the wireless is like four levels down from the top, and he's not even allowed to do anything.
"They do have some good stuff. If I had a content and a cable asset along with my wireless, I would start putting these things together, instead of bundling them. Put that on the side, but right now they seem very content. They donate close to 50% every quarter of the customers who come to T-Mobile."
Sprint
"Sprint is ... people don't fully comprehend that their economics and balance sheet have them on a timer for when you're going to cook an egg or something. These guys are playing the game for two quarters, kicking the can down the road, trying to survive. The financials, it's pretty much walk around the house and use anything that's not nailed down to raise money so we can go to the next quarter - and let's show some postpaid nets, even if we have to push them over from our prepaid side.
"But they stumbled onto a good commercial. It'll run its course, but it's clever. Their ads are not true, though - there's a gigantic difference in networks. But I don't talk about them, ever. I compete with Sprint with [T-Mobile US subsidiary] MetroPCS, and it's completely cleaning their clocks."
Legere said that he's happy with T-Mobile's growth and is playing the long game.
"Because in X amount of time I will be the largest wireless player in the country by a mile," he said. "Because each of the three carriers have been donating customers to me every quarter for three years. And so if they're good, I'm good."