T-Mobile CEO Leaves While Company Continues to Struggle

By Ian Bell May 26, 2010

T-Mobile USA, the wireless carrier that’s struggling against larger rivals, on Wednesday said CEO Robert Dotson will resign next year.

Dotson is leaving for personal reasons, the company said. He will be replaced in February 2011 by Philipp Humm, an executive from T-Mobile USA’s parent company, German phone company Deutsche Telekom AG.

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Dotson said that after 15 years with the company, he plans to step down to devote more time to his family and “take on entirely new and unique challenges.”

Humm, 50, was the managing director of Deutsche Telekom’s German wireless arm from 2005 and 2008, and “turned it around during his tenure to become Germany’s leading mobile operator in both subscribers as well as service revenues.”

He resigned from T-Mobile Deutschland to take responsibility for the loss of 17 million subscriber records to theft in 2006, and the company’s subsequent handling of the breach. The company said in 2008 that there was no sign the data had been misused.

T-Mobile USA, which is based in Bellevue, Wash., has been losing high-paying, contract-signing customers since last summer, and its quarterly revenues peaked in 2008. As the No. 4 carrier, it is finding it tough to compete against the much larger Verizon Wireless and AT&T Inc. Industrywide growth in contract-signing customers has stalled this year, and carriers now gain subscribers mainly by winning them over from other carriers.

T-Mobile USA has compensated for declining numbers of new contract-signing customers by selling prepaid service without contracts, but the competition has intensified in that market as well, both from new entrants like MetroPCS Communications Inc. and from No. 3 carrier Sprint Nextel Corp.

Before joining Deutsche Telekom, Humm worked for 10 years for a number of U.S.-based companies including McKinsey & Co., Procter & Gamble Co., and Amazon.com Inc.

In related news, AT&T is slamming T-Mobile for falsely advertising their HSPA+ product as a true 4G service.

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