The company also announced that it will modify its existing 3G and 3.5G HSPA+ networks to be compatible with the Apple iPhone (both GSM and CDMA models), which we consider to be a rather challenging endeavour.
Nevertheless, the initiative is part of T-Mobile's new Challenger Strategy, which includes $4 billion in network upgrades as it migrates to Long-Term Evolution (LTE) and attempts to become the nation's fourth LTE network, behind Verizon, AT&T and Sprint, respectively.
Of course, Verizon is the only large-scale LTE network that has managed to cover nearly 200 million people in 196 markets across the United States, while AT&T is still building out its LTE network with a current coverage radius of 74 million people in 26 cities across the United States. Nevertheless, AT&T expects to cover up to 170 million people by the end of 2012. Meanwhile, Sprint is barely planning to launch its 4G LTE network "in the first half of 2012" with expected coverage for the cities of Atlanta, Dallas, Houston and San Antonio; however, no plans for the largest metropolitan areas - Greater New York, the San Francisco Bay Area and Southern California, have been announced as of yet.
T-Mobile's $3 billion compensation, or "break-up fee" from AT&T, includes $1.4 billion in "incremental network investment" between 2012 and 2014. As the company is last to the party to hop on the LTE bandwagon in the United States, analysts and investors remain concerned about the company's marketing efforts to take 4G off the ground, considering that it currently markets its 3.5G HSPA+ capacity as a "fourth-generation network."
"Marketing the service will be tough when it has spent the last several years convincing its customers it is already offering 4G," Ovum Chief Telecom Analyst Jan Dawson said in a statement.