VoiceStream Morphs into 'T-Mobile'
Fri Jul 19, 1:32 PM ET
Jay Wrolstad, Wireless.NewsFactor.com
VoiceStream has started its transition to a new name and brand, T-Mobile, in the U.S.
with the launch Thursday of T-Mobile wireless voice and data services in the California and
T-Mobile is the global wireless arm of German telecom giant Deutsche
Telekom (DT), which will use the California and Nevada launch to
initiate a changeover from the VoiceStream brand to T-Mobile by the end
of the year and market the new nameplate in all of its U.S. markets.
VoiceStream, which was spun off from parent company
Western Wireless (
Nasdaq: WWCA -
in 1999, was purchased in June 2001
by DT for some US$20 billion, forming the first transatlantic wireless
carrier operating on the international GSM standard.
Leveraging Brand Equity
VoiceStream is the sixth-largest U.S. carrier, with about 7.5 million
customers and a 6.3 percent market share. The company recently has
been cited as the target of a possible takeover by
AT&T Wireless (
NYSE: AWE -
news), reflecting a
possible response to the heavy debt load being carried by DT.
However, reports of whether such a merger was actually in the works
were conflicting. The company also has a network-sharing arrangement with
The branding changeover has already been done with VoiceStream's
wireless LAN service, which is now known as T-Mobile Broadband. "The
objective here is to leverage brand equity with Deutsche Telekom and
promote the international benefits of T-Mobile,"
IDC wireless analyst
Keith Waryas told Wireless NewsFactor.
A Different Market
DT has been pushing its international roaming capability and is seeking
a consistent brand name across all continents to allow worldwide
marketing of a single entity, he said.
But because U.S. wireless service is based on local choices among
various technologies, compared to Europe, where virtually all
operators use GSM network technology, the jury is out on whether this
move will pay off for DT, Waryas said.
Touting New Faces, Features
To get the ball rolling, T-Mobile kicked off a massive multimedia
marketing campaign in California and Nevada, and the company has
apparently dropped VoiceStream spokesperson Jamie Lee Curtis in favor of
actress Catherine Zeta-Jones.
T-Mobile/VoiceStream offers service in 8,000 cities across the country,
including voice and data communications. Its
Wi-Fi (802.11b) wireless
broadband Internet access service
features an agreement with
Nasdaq: SBUX -
offer the service in the coffee shop chain.
The carrier also claimed it will also be the first in the U.S. to
introduce the Microsoft Windows-based Pocket PC 2002 Phone Edition
software platform for enterprise users.
In establishing a new corporate identity in the U.S., Waryas said,
T-Mobile is attempting to keep pace with the competition, but now must
devote time and resources to a new marketing effort.
"They spent a lot
of money on name recognition with VoiceStream, and now they will have to
do that all over again while handling parallel marketing budgets," he
"I'm not sure why they didn't roll out the service nationwide,
rather than market-by-market."