T-Mobile US, Inc. (TMUS) Earnings Call Transcript & Summary

Good morning. Good afternoon, everybody, and thanks so much for joining us. I'm delighted to introduce Neville Ray, who really needs no introduction Neville's President of Technology at T-Mobile, but I think we all know that Neville is really just President of Technology, period. Neville, thanks so much for joining.

To kick things off, on 2.5 GHz, you guys made an announcement today. You've blown through 200 million POPs covered. We're not even at December 31 yet. I say you sort of eclipsed your target for the year before -- a decent chunk before the year ends. What does that mean for the 2022 target of 250 million POPs, and is it really going to take you to 2023 to get to $300 million.

No. Thanks, Jonathan. Well, thanks for hosting us today, and we're always delighted to join your conference and your events, and appreciate the opportunity. We're celebrating here at T-Mobile this morning because, as you mentioned, we saved this news for you, Jonathan. So this conference today is our 200 million nationwide -- 200 million POPs covered, nationwide coverage with Ultra Capacity 5G. And as you stated, that's ahead of our plan, ahead of our schedule. We'd said we'd meet that number by the end of 2021, and we've moved past that as of the middle of November. So more to come in '22. We'll talk about that in a second. But I'm super excited. I'm just super proud of the team and the business overall. It's been just over 18 months of incredible work and effort since we combined with Sprint. And there's a lot of work still ahead of us, but it's great to get our first -- one of the first major milestones into the ground. We've always talked about combining with Sprint and how this process was about building the network, migrating customers and then, ultimately, delivering the very, very large and meaningful synergies for the company that will come as we finally collapse these networks into one. But our first step was the really important one. And as we've been combining the networks together, we've been rolling out 5G at a great pace. So we have a lot of 5G coverage with extended range. That's now at 308 million. And what we've been doing is layering on and adding a depth of spectrum and capability with Ultra Capacity 5G. And for us, that rollout, I know you know, Jonathan, but for the team on the call, that's primarily for us at 2.5 gigahertz spectrum. And we're targeting 100 megahertz of the 2.5 to be deployed across that nationwide footprint by the end of 2021. So obviously, our competition, we're 6 weeks ahead of our goal, but we're years ahead of where our competition is today on that mid-band rollout. And not just in terms of the footprint, but also in terms of the depth of the spectrum that's available to the competition in the mid-band space. I mean AT&T and Verizon have that first 100 megahertz of C-band, I mean between them, 60 and 40, respectively, Verizon and AT&T. But here we are, where we're deploying and are deploying 100 megahertz of 2.5 gigahertz just at T-Mobile for the end of this year. So super proud of the team. It's been 18 months. We've had a pandemic. We've had supply chain issues. We've had resource issues. It's been difficult at times to put all of the pieces necessary together to roll out this network at the size and scale that we've achieved. But I'm super proud of the team and delighted to be able to celebrate that milestone with you today. 2022, to get to your question, we'll do more. We've said at this point in time, 2022 will extend that footprint from 200 million to 250 million. And then in '23, we'll go from 250 million to 300 million people covered with Ultra Capacity. And again, you know me, but to put the competitive story in everybody's view, by the time we're at 300 million, our competition has publicly stated they will try and get to where we are today as T-Mobile. So that's a very distinct advantage in gap that we've been successful in putting in place as we've moved through the last 18 months.

Yes, and we're going to have to see how it goes for them with the struggles that they're facing with the FAA now. Could take longer for them to get access to that spectrum than initially hoped. But Neville, when I sort of look at your targets, you've done 200 million in 18 months and then 50 million next year, 50 million the year after. Why do those next 2 chunks happen more slowly?

Because I don't want to tell you it's more than that, Jonathan, at this point in time. No. No, clearly, I mean -- and this is an important discussion because that first 200 million POPs is primarily urban-centric. It's kind of metro. There are some -- obviously, there's a ton of suburban in there, but there's some smattering and sprinkling of rural environments already starting to see the goodness of 2.5. But to get to that next 100 million POPs, Jonathan, that's a massive undertaking because the geography, it really starts to thin from a POPs perspective. And so just to put that into geographic comparison, to move from 200 million to 300 million POPs, that's 5x the geographic coverage area that's required. And so that's a lot of sites and work that has to happen. Now as a team, are we going to look to, with Mike and Peter's support, accelerate capital, maybe do some things in '22 and '23, '22 specifically at a faster pace? We'll see. We'll announce those plans hopefully sooner rather than later. But we have a material competitive advantage over AT&T and Verizon in this 5G space today. I don't think that's disputed across all of the various benchmarking entities and folks that are measuring networks, almost all of them anyway. And so it's the time for us to press the gas a little bit further and accelerate those stats and numbers that we've said we want to do by the end of '22. It's a great time for us to do that, Jon.

Right. So Neville, you've gotten to 2/3 of the country with Ultra Capacity. In the recent OpenSignal data, we noticed that only about 1/3 of your traffic is on the Ultra Capacity network. What accounts for the discrepancy to the gap?

Yes. I mean I think if you look in balance, and I'll share our data with you, Jonathan, you see different benchmarking methods across the different companies. So I mean, we announced in conjunction with our 200 million nationwide POPs and Ultra Capacity today, another umlaut study, which shows 4 major cities in the U.S., how we're leading. And they're availability measurement because they do more driving and some specific physical testing. That number is about 75%. And that's kind of where we come out on our measurement. I think for OpenSignal, some of the other entities, it's handset-based. They're still working the penetration of their app and the device base with 5G capability. And so that kind of reflects in an understatement. But I give you this that if you look at ultra-capacity 5G, that footprint we've talked about today, that covers approximately 80% now of the T-Mobile customer base. So 80% of all of our 100-plus million customers, they live within that Ultra Capacity footprint. And their ability to access that with a 5G device, I mean it's just orders of magnitude greater than what we're seeing with Verizon and AT&T on their -- was ultra wide band from Verizon and then 5G plus isn't it from AT&T now. But that was a primarily millimeter wave constrained footprints with very low single-digit availability numbers, Jonathan. So our numbers, we're seeing folks with iPhone 13 and the 5G-capable device, that smorgasbord that's out there now, they're seeing ultra capacity 5G pop up and being way more available to them than even if you compared 6 months ago. I mean that's been the pace of the rollout that we've really been attacking in urban and metro U.S. Thousands and thousands of sites have been upgraded and are now fully on out with all of that spectrum we talked about.

Never when will carrier aggregation across 2.5 and 600 megahertz be available?

Yes. So great, great topic, Jonathan. I love this one because we announced, and we talked through this when we did our Analyst Day earlier in the year about how we really want to extend and push this kind of mid-band 5G range and capability. And so one of the things that we're working on very hard and have been for well over a year now is the ability to couple 600 megahertz on the uplink with 2.5 gigahertz on the downlink. And what does that do? It extends the reach and in-building coverage and capability and capacity of -- capability and reach and performance of that 2.5 layer in our testing by up to 30%. So when you think about that footprint, we were talking about our big geographic area, having like that low-band capability to extend the reach of mid-band, very important. And so where are we? To your question. So the network is being upgraded, will be fully upgraded by the end of this year to support that carrier aggregation combination. Now there are other spectrum band combinations and so on, but low-band 600 megahertz with 2.5 gigahertz Ultra Capacity mid-band. The handsets are and will be receiving upgrades over the air, software updates, MRs, as we move into next year. And so the rate and pace and frequency of those will start to really -- we may get some done this year. It's -- where are we, middle of November. So we're 6 weeks away. Focused on the network right now. I think the handset piece is going to follow in Q1 of next year. And so that's a big -- it's another big push for us, Jonathan. So it's not just about covered POPs. It's about getting a lot of spectrum. It's about leveraging that layer cake of banding that we've been so vocal about for some time to really extend the reach and capability of that 5G experience. Doing stand-alone 5G, getting carrier ag in place, ultimately getting to voice on a 5G layer which is, again, incredibly important if you want to keep them, have all of your 5G services with all those low latencies and so on, on your 5G network. So a lot of different pieces we're working. But I think we're out in front. I know we're out in front on many of these features and capabilities based on what we hear and see from the vendor community.

The handsets capable of accessing carrier aggregation with an over-the-air update, is that something that will be -- that will work with all handsets? Or is it just the sort of the latest generation or 2?

The majority. So I'm sure -- I know there's going to be some early 5G terminals and devices that won't support that capability. But right now, from what we see and the testing and work going on with the OEMs and with the network folks, the vast majority can be upgraded to support that experience and capability. Not everybody will need it, Jonathan. That's the other piece, right? If you're in a tremendously strong 2.5 coverage area, you don't need that carrier ag. It's when you get out to that kind of cell edge, and the 2.5 coverage is starting to fall away, and the uplink deficiency on 2.5 get supplemented and lifted up with the 600 megahertz layer. So -- and we manage all of that very carefully, right? Because you don't want to just overload your 600 megahertz in areas where you don't need to do it. So a lot of work. Team's doing a fantastic job on it, and we're super excited about the capabilities and coverage reach that will provide.

So the OpenSignal data also showed pretty clearly, Neville, that you got this almost tenfold increase in speeds on ultra capacity versus 5G on other bands and everybody else is sort of mostly trapped on those lower bands. The one area where Verizon still comes up out on top on third-party surveys is around consistency and reliability. And when I asked Verizon this morning, how they view the competitive threat from you guys given your speed advantage, their view is that really what customers care most about is consistency and reliability. When I look at your spectrum portfolio and the number of cell sites you have, it seems like you ought to be able to win on consistency and reliability as well. When is Verizon no longer going to be able to advertise that they've got America's most reliable network?

Yes, it's great conversation, Jonathan. It's kind of funny that the Verizon guys would say speeds are not important, when they're the guys that painted 5G into the corner of gigabit speeds, right? Day 1, right? Before they could really deliver on anything. It was all about speeds. So that's kind of humorous that they retreat into that corner. But that said, I think, to your point around 5G leadership, I don't think it's in dispute today, Jonathan, about who's leading the 5G story. And so if you look across all of the benchmarking folks, OpenSignal, you look at -- we've been working with the umlaut guys a lot, and they're doing very specific citywide tests. They announced some more results in 4 major cities today again. If you look at Ookla and all of the work that they're doing, PCMag is another one that came out with a really strong story. And last week, Root came out and basically said, "The fastest, the most available 5G network is T-Mobile." And so when it comes to that -- the speed and performance of this network, which really sets up the industry for what comes and all the use cases and capabilities that we'll talk about as we go through the discussion here today, having that speed and capacity is not just about running a speed test on a device, it's having a multilane heavy capacity capable, spectrum-rich network to support all the things that 5G are going to bring. And there's no doubt. I mean, our network is head and shoulders above anything that AT&T and Verizon can come close to delivering today and will struggle to match over the next several years, in fact. So -- and all of the benchmarking is coming out on that front. Now the one area where I think you will see -- we have reliability support from umlaut and others on the 5G front. I think, for Verizon, you see the reliability support coming through from Root. And I think there, they're primarily mixing LTE voice into the service that they measure from a 5G perspective. So I do want to isolate that 5G story, Jonathan, because there is no voice in 5G today. But if you look at 5G services and 5G capability, there's only 1 -- there's only -- there's a lead horse, it's us. And I don't think that's in any form of dispute across the industry today. And it's not just about running a speed test app. It's about building the next generational network in a formative and material way. I think the advantage that Verizon has historically had, and maybe less so AT&T, is about that reach and consistency of experience on LTE. And so, for us, that's been a multiyear journey. You followed us through this. We've been looking to level that playing field, and it's a multiyear path that we've made huge inroads on. We still have some work to do, and we continue to do that. We continue to build out in rural venue locations, places where it's important for customers that are coming to T-Mobile to have service. And we've almost leveled that playing field, not fully, and there are places where, obviously, we see competitive performance better than us. But we're also starting to see many places where that story is reversed, Jonathan, right? Where we have, in rural part destinations, you name it, where folks are now seeing T-Mobile service with 600 megahertz LTE and 5G coming through, and they're not getting service from Verizon and AT&T. So I'm not going to tell you I fully leveled that playing field yet, but that's an integral part of the work that we're doing. And this is one of the advantages in the combination with Sprint because Sprint had coverage sites and areas that -- no 2 networks are ever the same, and there were clear coverage sites that we are keeping and retaining and upgrading as part of that T-Mobile and Sprint combination. So bringing more of the Sprint coverage sites into the T-Mobile network, expanding our reach, our in-building story and our rural story. So we are very focused on becoming the leading network, not just on 5G, Jonathan, but to be the leading network, period. That's the task in front of me that Mike and Peter are supporting us and investing in us to go deliver on. But the great news is when you think about the next thing and the size and capability and growth that will come with 5G, we've established a really strong, powerful lead in that space, while we continue to address those other issues, small they may be, but we're taking care of those as we move through the next couple of years.

And so Neville, from a timing perspective, is it once you've completed the integration of Sprint, and you've got all spectrum bands deployed pretty much across 85,000 cell sites, is that the point at which you think the sort of reliability on voice will be -- you'll be indisputably on -- at least on a par, if not better than the other carriers on that as well?

I hope sooner, Jonathan, right? And this is the thing you, have to break it down, right? Because for the vast majority of customers that use our service today, there is no differentiation on service availability between Verizon and AT&T. But for the vast majority of customers, they are not in those areas where there's some differentiation and maybe some coverage gap or gain or whatever it might be. But to get to the de facto point where you can say, okay, square miles coverage, however you want to measure it, is equivalent, that's still a couple of years out, maybe the end of -- we'll make big strides in '22, maybe by the end of '23, if not before. Then we're going to put that thing to rest completely. Because, as you say, we have the assets, we have the sites, we have the spectrum now, and that's all embedded in our program to bring these 5G services out to all the corners the U.S. And it's important, Jon. If you think about the rural story in America, right? So we were talking earlier on today, right, about how we're going to get to 300 million people covered. That's almost -- it's not every American in the country, but it's not far off, 300 million people covered with Ultra Capacity. At a point in time, where AT&T and Verizon are saying there'll only be where we are today, about 200 million, that's their public statements from what I see and read. And so in those rural environments, we're out building this massive multilane freeway, bringing 5G services and mobility and fixed wireless, all those different pieces. And our competition is saying, well, we're not telling you we're going to do anything on 5G in those places. So I want to turn the table completely, whereby when folks travel outside of metro areas, and this is starting to happen, and they move into more suburban and rural environments, they're going to find T-Mobile with 5G. And in many of those places, that service and performance is going to be so superior to what LTE is -- the LTE services being delivered by AT&T and Verizon today, there'll be no competition there. And they are yet to really respond to that opportunity. And we're very serious. If anybody doubted, Jonathan, our intentions with what we're doing as we combine Sprint and T-Mobile together, everything we said we were going to go do, we are doing. And back to the announcement today, that's a huge milestone drop on something, a major milestone, a major set of achievements that we said to the FCC, to the DOJ, to the investor community, we're going to get this done before we even knew about a pandemic, but we've got it done. First big milestone in the ground. And the others are going to come and they're going to come quick.

Congratulations on the milestone. Thanks for saving up for this conference, Neville. We appreciate it.

Yes.

Speaking of speeds, the other interesting thing we saw in the data was the acceleration in the network as you added the amount of 2.5 gigahertz spectrum you had deployed. So you went from sort of 40 megahertz to somewhere between 60 to 80 megahertz and there was an automatic step-up in speed. When you go to 100 megahertz everywhere, which you'll be at by the end of the year, where do we go from the 300 to 400 megabits per second in speed?

So what we're seeing, I'm not going to give you all the data, Jonathan, all my secrets, but there are a lot of sites already out there with 100 megahertz. And so when we talk about that 400 megabit speed, that's what we measure on the network capability and performance, and that may differ a little bit from what benchmarking is showing for what folks are using. But the capacity and capability, the pipe of the network is now supporting, on average, 400 megabit speeds. That's kind of what you're going to see across almost the entire Ultra Capacity footprint. In some places, you're going to see more. So I mean, obviously, I'm a huge consumer of our services. I know a few places where I will pull down 1 gigabit per second on Ultra Capacity. I'm often pulling down in environments I go to 500, 600, 700 megabits per second. And that's -- you're going to see those types of speeds and peaks in areas where we've got dense Ultra Capacity deployment. But on average, we always said, our commitment and plan with the FCC was to get to a 400 to 450 megabit per second average across the geography. And so -- I mean, it sounds like an old stat to me, but I was talking to one of the team members, when we first put the plan together 3.5 years ago that we took to the regulators, we were all like pinching ourselves, checking, double checking, triple checking, do we really believe we can deliver on a network that will provide speeds an order of magnitude greater than what we're doing on LTE today? 40 to 400 megabit per second? That's like running around with you're connected to a cable or fiber strand, fiber strand more than cable strand. And that's where we are. It's happening. And that's a pretty amazing transition in a short period of time where we're talking about how many hundreds of megabits of speed can we support on a wireless network? I mean this thing is, it's super exciting. For an old dog like me, Jonathan, it's like I was so proud when we're in GPRS days and we did 128 kilobits. And here we are doing hundreds of megabits per second is an incredible transition, but it's dependent on great radio, great vendors, great team, good product and spectrum, right? As you referenced many times. So...

Right. Yes. And spectrum dev specifically, Neville. One of the things that you've sort of spoken to is the path to 200 megahertz up from the 100 megahertz that you're going to have to put at the end of this year. Obviously, you've got another like 50 to 60 megahertz of 2.5 gigahertz sitting in reserve. What gets you the remainder? Is that filling out the rest of the 2.5 gigahertz block? Or is it folding in other bands in the upper mid-band arena?

Yes. So if you look at our holdings, Jonathan, so we're -- let's just use -- ruffle the math, right? So we're at about 300 megahertz of mid-band spectrum. So if you do the breakdown, you've got 160 or so on a national basis, average basis in the 2.5 gigahertz layer. And then we picked up 40 megahertz in the C-band auction, not everywhere. So that kind of gets you into that 200 range. And then the balance is AWS and PCS spectrum. And of course, there was -- we have a huge wealth of like PCS spectrum as you look at T-Mobile and Sprint coming together. So what we're deploying and deploying more of now is not just, obviously, 2.5 5G-capable radios, but it's AWS and PCS, specifically PCS 5G-capable product, too. We're not deploying C-band yet. We don't have availability on C-band we bought in the second tranche until the end of '23. But if you look at next year and what we can do up until that C-band point, it's all a function of as the network gets built and we migrate customers and traffic over to that network, we can free up more and more of the legacy Sprint spectrum, not just in 2.5, but also in PCS to leverage for 5G on the T-Mobile final network configuration. And so 300 megahertz of mid-band is a great position to be in. Our competition is loading up on mid-band, too. They're a little gated on the C-band issue that the FAA has raised with the FCC. I'm confident that will get resolved over time. I don't know how quickly it will happen. But obviously, we're supportive of the industry position that the interference concerns can be addressed. They can be mitigated. Maybe there are some things that have to happen to enable a fast deployment or a faster deployment on C-band. We'll see. But for us, I mean that C-band issue is kind of headlights up. It's 2 years plus. But in the meantime, we have a wealth of AWS and PCS assets that are primarily used for LTE today, Jonathan, right? We have -- 75% of our customers are using LTE, 25% are using 5G, 27% approximately on the postpaid phone side. And so you still have to support those LTE services. This is part of the balancing act as we migrate customers and we migrate more and more customers into 5G products, then we commit and can commit more spectrum into the 5G arena. So a lot of moving parts. But the good news is we have the assets that are needed to deliver on that 200 megahertz story committed into 5G for the end of '23 that we've talked about before.

Neville, when do you think consumers will really start to care about 5G? When will it become obvious to sort of the mass market that they need to be on the T-Mobile network to get access to all of the incredible capabilities that you're building that other carriers don't have, that they're sort of missing out without it?

Yes. I think it's starting to happen now, Jonathan, right? I mean, we're seeing customers that are joining the T-Mobile family and buying that new iPhone 13 coming over to T-Mobile. They're seeing a very different network. I mean, one with a performance capability and speeds that are generating just way more traffic and way more usage, a great thing. 35 gig of monthly consumption we talked about on Magenta MAX, which is our fully unlimited 5G rate plan. You couple a plan like that, the value of that plan with the experience, and you see just tremendous excitement and uptake. And it's starting to get -- now it's starting to gain momentum. I think we're starting to foster and generate the recognition for having that 5G leadership. And as we move into '22, I mean, more and more customers -- I know personally, if I pay whatever you pay for an iPhone 13 these days, it's not a cheap piece of consumer electronics. There's a lot of folks that are taking that product home in AT&T and Verizon land, and it works just the same as their LTE device. With DSS, for example, that Verizon broadly deployed, it may not work as well as your LTE device. So customers are smart. They want a future-proof buying decisions, Jonathan. None of us want to buy the old thing. They want to buy something, which is going to grow with them into the next set of network experiences. We're delivering that at T-Mobile. So when customers are buying product from us, there's excitement, there's engagement. We see much higher usage levels, much of which is the things they do today, they just do that more often. But that's okay, right? I mean when you're starting out on the 5G journey, especially in consumer, that's important, that really grew the LTE category and so on. But for us, I mean, you know the story, we went through this on all these dimensions of growth for us when we look at 5G. And many of them are about extending our network reach and range into small markets and rural areas where we've been very poorly penetrated. Now we can offer customers a very differentiated experience in those environments compared to the competition. We're not coming to rural Montana with something that's just what AT&T and Verizon have. We're coming with something which is way, way better and it offers more value. So as that happens, there's a lot of upside for the company in that geography where we never really used to compete. And then there's the whole fixed wireless opportunity and the avenues that we open there for new growth, not just a focus for us, but for others, too, but that's a very real and powerful use case in 5G. And then the third leg of the stool is really this enterprise and business growth. And again, I mean, limited penetration into those market segments and opportunities for us historically because of network disadvantage, Jonathan, right? And so now we're seeing more and more companies come to T-Mobile, test our network. They don't just look at the TV, right, and follow the advertising. They take product. They test it with their end users. They look at all of the benchmarking. Sometimes, they pay for their own. And more often than not, we are now starting to win huge businesses over to the T-Mobile side and the T-Mobile family. So all of those growth vectors, many of them are down to, okay, if you're going to make a big buying decision that's personally for a consumer or for a business, you want to make sure you're buying into the future, right? That you're not buying into legacy services and capabilities that the dollars that you invest are going to reward you with that next set of experiences and capabilities. So I think consumers are already there. They're starting to feel and see the differences. I think the use case story will start to grow as we move into '22 and '23. You and I could talk about that for an hour, the things that are coming. But we are starting to see a lot of excitement and investment come into this 5G ecosystem for consumers. And I think more and more of that will come alive in '22. Gaming, for example, is really starting to move. That's a super exciting set of use cases. With a stand-alone network, you can support much better latencies, which is really the key. It's not about speed so much for a gamer, it's about latency and reaction. Those things come with a great big 5G network. I look at the wearable space. I think that's super exciting, especially the eyewear story, a mixed reality and the capabilities that can come with that. Things that we could never dream about really doing in any manner or form well or effectively on an LTE network, they're now capable on our 5G network, a network that can support the hundreds of megabits of speed that you talked about, with broad reach and depth of spectrum, that's something this industry and consumers in droves will grow into and look to enjoy. And for us as a company, having a lead in that space, it's -- that's tremendous. That's a big opportunity for us to keep reminding our customers and our potential customers that we have this opportunity here at T-Mobile.

So Neville, you mentioned sort of 3 opportunities for you. One is continuing to take share in the consumer mobile market. The other one is in fixed. And the third is in enterprise. Moving on to fixed, how many households do you cover today? And what's the path to get to that target of 90 million? Is it a matter of pushing 2.5 gigahertz spectrum beyond the first 200 million POPs?

Yes. I mean so we've talked about the 30 million. We've not updated that number today. I think we talked on earnings about closing on 500,000 customers for the end of this year and then 8 million to 9 million as we move through the next 3 to 4 years. And you're absolutely right, Jonathan, it's all gated on the pace and scale of the 2.5 gigahertz rollout. So the fact we're delivering early on the first 200 million portends opportunity to accelerate growth in that segment as we move into '22 and '23. And I know there's a ton of questions about how can you support fixed wireless home connectivity on the wireless network. And if you've asked me like 10 years ago, I'd say never. But when you do and you look at the capacity that we're generating, the stat that we are now seeing come to life is that if you looked at T-Mobile precombination with Sprint, and you look at the capacity that we can generate as we combine the tower assets and the spectrum assets together in the combinations we've been talking about this morning here or this afternoon, that multiplier is 14x, Jonathan, it's 1 4, 14x. And so how many industries do you end up in a position where with this transition into the next evolution of the technology, you can provide a multiplying effect of that size, scale and magnitude? And so 14x generates a ton of capacity. And in many areas of the country, we still don't see a path for wireless mobility consumers to consume that volume of spectrum and capacity because there just aren't enough people in many -- there aren't enough people in many of those places. So that extra capacity that we're generating, we can commit to providing a great in-home service. It's not everywhere. It's not for everybody, but it's been a fascinating year on this, Jonathan, because the demand in this space is compelling. I mean there are so many dissatisfied customers, and I think, especially after the pandemic and the importance of home connectivity, and they are desperate for choice, competition, better service, all the things that we've tried to -- we're building into and have been building into this T-Mobile brand. So when we pop up with, "Now you can support your home connectivity or your business connectivity from T-Mobile," again, it's not everywhere at this point in time by any means, right? But in the places where we are marketing that service, we're seeing huge interest and great uptake. So that's a really -- we're not building out -- I'm not investing and putting up new towers and 2.5 radios to support fixed wireless, Jonathan. I'm building them to deliver on our mobility promise and the effectiveness of that 5G network. And in many of those areas, because I can go and deploy 160 megahertz of spectrum on a 2.5 gigahertz radio, I could never do that if I went back even 5 or 6 years ago. My kind of capital costs are kind of embedded. They're already there in the mobility business, so we can leverage great economics and there's great capacity and capability for fixed wireless. So it's a super exciting use case, and a very real one.

Neville, what determines -- so you're covering 200 million POPs. You've got 30 million households where you're offering your service today. What determines which households you target within areas that you've got Ultra Capacity?

So it's really a net math story. So we look at the performance of the network in those areas, Jonathan. And it's obviously not just today. We're projecting growth in mobile. I mean we projected in the deal with wireless customers by '24, I want to say from memory, would be consuming about 80 gig per month on their mobile devices. So we have similar targets and growth vectors that we look at on fixed. And so we look at where we've deployed Ultra Capacity, where can we support and fit in that fixed growth? How does that live? Where does that live while maintaining the performance and expectation and growth levels that we look to see on the wireless front? It's kind of a net math story. And so that sounds simple. It's not. There's a ton of work and activity that has to go into generating our maps and our service areas for our sales teams on the fixed side. But we're really learning. We've -- wherever we've made missteps and we've got our calcs wrong, it's a continual improvement story for us so that we can get behind a fixed wireless product that we're highly confident in with a great service and great capacity. So it's a lot of network math that's going into how, where and when can we support these home broadband customers.

Neville, you guys announced a deal with Pilot Fiber, which I thought was really interesting. Is this just a one-off? Or is it a very small example of a much bigger theme? Are you guys ultimately going to need to partner, build, buy access to fiber everywhere or just about everywhere?

So that's very much a pilot, Jonathan. But, again, we're out -- we're exploring. And we're looking at that -- I mean, that's an urban, a very urban deal, right? And so it's a place where we can couple our brand with some fiber infrastructure and offer a great service with all of the T-Mobile brand and tech support. And so we're piloting, trying that. Are we going to replicate that model in many, many places across the U.S.? I'll be honest, I don't know yet. You know us, we primarily, for our cell sites even, we lease fiber. We don't build our own fiber. But the economics on that model are so compelling to us today, even when we're now hitting some more and more rural environments with multi-gig circuitry required for the 5G experience. The economics make total sense for us to continue to lease that fiber service and capability. And we see huge competition in that space in urban and metro areas. So we're leveraging that marketplace. And can we leverage it outside of our traditional business for some fixed wireless competition? You bet you. Why not?

Neville, we've run out of time. I didn't get a chance to get to the enterprise opportunity, which is really exciting as well. We're going to have to save that for our next conversation. But I really appreciate you doing this call today. This is tremendously helpful. Thank you.

Thanks, Jonathan. And delighted we could come on and celebrate 200 million POPs of Ultra Capacity nationwide 5G with you. So...

Congratulations again.

All right. Thank you.

Cheers.