T-Mobile closes Lumos deal
T-Mobile’s joint venture with EQT (a global investment organization) has closed on the acquisition of Lumos, which currently passes 302,000 homes with fiber. T-Mobile invested $950 million in the JV, gaining a 50% stake and is expected to invest a further $500 million over the next three years as the JV looks for rapid expansion of the fiber solution 0 with a goal of passing 3.5 million homes by the end of 2028 and potentially 12-15 million households by the end of the decade.
Lumos will provide wholesale fiber access, allowing smaller companies to lease capacity to deliver services to the home (just like an MVNO in mobile terms) while T-Mobile will be the anchor “customer”.
The Circana Take:
- The mobile carriers are all looking at fiber to the home strategies to augment the mobile networks. It allows the carriers to gain more consumer wallet share, while also offloading more wireless traffic to the fiber network.
- Potentially, Lumos can also help with tower backhaul solutions for T-Mobile, which could reduce the carriers costs over time.
- Fiber/wireless combos are nothing new: AT&T and Verizon have been building fiber to the home for years. What could be interesting is how stronger converged services could come out of this: not just bundled pricing but genuine innovation.
- What we are seeing is part of a larger landgrab as mobile carriers look to scoop up regional networks, which is reminiscent of how the mobile market evolved. Indeed T-Mobile has another fiber JV in the works, looking to acquire Metronet, while Verizon has announced its intention to acquire Frontier. As for AT&T… read on.
AT&T eying Lumen for broadband
AT&T is reportedly looking to buy Lumen’s consumer broadband business (that’s Lumen with an “e” rather than the far darker Lumon). The report comes from Bloomberg which believe the deal will be $5.5 billion. There has been no official confirmation of the deal, but in November 2024, Lumen’s CEO said that she believed it was difficult to imagine long-term success for Lumen in the traditional telco space.
The Circana Take:
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“Ma Bell” AT&T has always been in the pipe-to-the-home business of course and is currently trying to decommission its copper-based network that can no longer keep up with broadband needs. Buying additional fiber networks to supplement its current fiber footprint will hopefully help the carrier pull out more copper.
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It’s beginning to look awfully like a land grab race, with mobile carriers pushing more aggressively into the fixed-to-the-home business. Expect more deals to follow.
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These “mobile” carrier moves increase pressure on the cable companies that are already feeling the threat from Fixed Wireless Access solutions. Perhaps the real “race” will not be a landgrab per se: the winner will be the carrier that creates the most compelling “converged” solution for consumers.