That's the biggest question hanging over the telecom sector, after a year of consolidation re-configured the industry and may have created two new disruptive forces in T-Mobile and Sprint (S). It's also a story to watch for AT&T and Verizon, which set new records for wireless profit margins in 2013.
If T-Mobile can become profitable in 2014 and beyond, it may prove that reliable nationwide wireless data service is in the process of becoming a commodity product with falling pricing. That would have major implications on AT&T and Verizon, who both profited, in recent years, from a consumer shift to smartphone devices and higher data consumption at faster speeds.
Currently, consumers pay good money for the reliability and speed of AT&T and Verizon's data service. Given a low-cost alternative, however, habits may change.
That's exactly what T-Mobile is banking upon.
The telecom has defined itself as the "un-carrier," and broken about every rule AT&T and Verizon adopted to drive their rising profits in recent years. T-Mobile doesn't lock customers up to multi-year service plans, it is buying customers out of their existing contracts, and is attempting to offer data plans at a fraction of the price of larger competitors.
So far, T-Mobile's results indicate that when given a good deal consumers take notice.