Metro PCS 2011 Annual Report Download - page 49

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at all or at prices that would make roaming cost effective for our customers. If our customers or potential customers demand
4G LTE services on a nationwide basis or our competitors offer 4G services on a nationwide basis, we may be unable to meet
customer expectations or demands and we may attract less than the anticipated number of 4G LTE customers or we may
experience higher than anticipated levels of churn. If we do not attract the number of 4G LTE customers we anticipate, it could
have a material adverse effect on our business, financials and results of operations.
We are increasingly focused on providing nationwide service, but we may be unable to obtain the roaming and other
services we need from other carriers at rates that allow us to provide such nationwide service and still remain competitive.
The market for our services increasingly requires that we provide nationwide coverage for such services. Many of our
competitors have, or have access to, national networks with substantially larger footprints than we have covering substantially
all of the United States population as well as international roaming arrangements, all of which enable them to offer automatic
roaming, long distance telephone and 3G and, in the future, 4G LTE services to their customers at a lower cost than we can
offer. This also allows our competitors to sustain unlimited flat-rate local, and nationwide roaming plans on their existing
networks over a larger area than we can sustain on an economic basis. We provide a significant portion of our nationwide
services utilizing roaming agreements with other third party carriers, which allows our customers to roam on those carriers'
networks to provide voice (and some data) services to areas outside our service areas and to improve coverage within select
areas of our footprint. We have entered into agreements with other third party carriers who provide such roaming services to us
and who carry long distance calls made by our customers. These roaming agreements, however, do not cover all geographic
areas where our customers may seek service when they travel, and they generally cover voice but may not cover data services
or other advanced service features. These agreements are subject to renewal and termination rights, and if such agreements are
terminated or not renewed, or the rates charged to us increase substantially, we may be required to pay significant amounts of
money for roaming service and we may be unable to provide nationwide coverage to our customers on a cost-effective basis.
Additionally, our aggregate roaming costs are highly susceptible to the geographic roaming patterns and usage patterns of our
customers. Since our unlimited nationwide service plans do not include any incremental roaming charges, we absorb these
costs such that as we add customers our roaming expenses will increase. As customers increase their roaming in amount or
frequency our consolidated financial results could be negatively impacted.
If we are unable to meet our customers' expectations for nationwide coverage for the services they want, it could reduce the
number of new customers we add to our services and may increase our churn. We also may be unable to provide roaming for
certain services, such as 4G LTE data, at all or the rates may not be acceptable to our customers. If our customers demand
roaming services, such as 4G LTE roaming, and we are unable to provide such roaming at all or at cost effective rates, we could
have increased churn, decreased growth, and lower revenue and profits. Further, if the rates we pay for roaming increase, it
could reduce the profits we make on our services, or require us to cease providing such services on an unlimited basis. A
termination of existing roaming agreements or a significant increase in the prices we pay for roaming could have a material
adverse effect on our business, financial condition and operating results.
Further, if the wireless industry continues to consolidate in the future, we may have increased difficulty entering into new
roaming agreements with other technically compatible carriers offering comparable quality of service or replacing our existing
roaming agreements. In addition, we believe the rates we are charged by certain carriers in some instances are higher than the
rates these carriers charge to other roaming partners and resellers that may have large call volumes or certain affiliations.
Further, our options for roaming in the future, especially with respect to 4G LTE roaming, may be more limited and the market
power of the remaining carriers may increase which may allow them to increase prices or impose other terms which are
unfavorable to us.
Business, political, regulatory and economic factors may significantly affect our operations, the manner in which we
conduct our business and slow our rate of growth.
In the recent past, the United States economy has deteriorated significantly, unemployment rates have increased and such
conditions may continue for the foreseeable future. Our business is being and could be further affected by such economic
conditions, including, but not limited to, consumer credit conditions, consumer debt levels, rates of inflation, energy costs,
unemployment rates, housing foreclosures, as well as consumer confidence and consumer spending, in the areas in which we
operate and these areas may experience greater impact from these factors than other areas of the country or may recover more
slowly. In addition, most of our handsets and our infrastructure equipment are purchased from vendors who are located outside
of the United States and disruptions in trade with these countries or trade agreements could impact our ability to get the
products and services we need to operate our business. These factors are outside of our control. If economic conditions and
unemployment rates continue to deteriorate, or remain depressed, our existing and future customer base may be
disproportionately and adversely affected due to the generally lower per capita income of our customer base (versus the largest
national facility-based wireless broadband mobile carriers) and their inability to pay and increased potential to terminate a