MetroPCS Communications Inc.
(
PCS
) is all set to woo its customers by adding content from ABC
Entertainment. The company has recently joined hands with ABC, to
bring ABC and subsidiary lifestyle content such as Disney Channel,
Disney XD and ESPN on all its 4G handsets via MetroSTUDIO video
on-demand application. The deal terms were however not
disclosed.
The company's MetroSTUDIO was launched in September 2010 to
enhance customers' entertainment experience. The addition of new
content from ABC Television Group is expected to attract more
customers and provide competitive advantage against market veterans
like
AT&T Inc.
(
T
) and
Verizon
(
VZ
). Further, MetroPCS wireless data services remain powered by
superior 4G LTE technology, which is rapidly becoming the standard
platform for communication across the globe.
In fact, MetroPCS was the first wireless carrier to offer 4G
service as well as introduce the world's first 4G Android-based
smartphone from Samsung. MetroPCS currently offers three 4G LTE
service plans -- the $40 service plan, the $50 service plan and the
$60 service plan.
MetroPCS provides 4G LTE services primarily in selected major
metropolitan areas in the U.S., including Atlanta, Boston,
Dallas/Fort Worth, Detroit, Las Vegas, Los Angeles, Miami, New
York, Orlando/Jacksonville, Philadelphia, Sacramento, San Francisco
and Tampa/Sarasota and plans to cover majority of the other
metropolitan cities in the U.S. by the end of the year. Further,
the the company focuses on introducing "4G LTE for All" services
over the long term.
Hence, we believe continuous subscriber growth coupled with the
rollout of attractive wireless plans and strong product portfolio
will act as tailwinds for MetroPCS going forward.
However, we believe the highly leveraged balance sheet, higher
promotional expenses for rolling out new service plans and new
smartphone offerings, increased churn rates, competitive market,
and regulatory issues may limit the company's upside potential.
We thus, maintain our long-term Neutral recommendation on
MetroPCS Communications Inc. Currently, MetroPCS Communications has
a Zacks #3 Rank, implying a short-term Hold rating.
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