Nils Paellmann - Director John J. Legere - Chief Executive Officer, President, Director and Member of Executive Committee J. Braxton Carter - Chief Financial Officer, Executive Vice President and Treasurer G. Michael Sievert - Chief Marketing Officer and Executive Vice President Neville R. Ray - Chief Technology Officer and Executive Vice President Peter A. Ewens - Executive Vice President of Corporate Strategy

John C. Hodulik - UBS Investment Bank, Research Division Simon Flannery - Morgan Stanley, Research Division Philip Cusick - JP Morgan Chase & Co, Research Division Richard H. Prentiss - Raymond James & Associates, Inc., Research Division Brett Feldman - Goldman Sachs Group Inc., Research Division Michael Rollins - Citigroup Inc, Research Division Jonathan Chaplin - New Street Research LLP Kevin R. Smithen - Macquarie Research Joseph A. Mastrogiovanni - Crédit Suisse AG, Research Division Craig Moffett - MoffettNathanson LLC Amir Rozwadowski - Barclays Capital, Research Division Colby Synesael - Cowen and Company, LLC, Research Division Justin Ages - Evercore ISI, Research Division

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the T-Mobile US Fourth Quarter and Full Year 2014 Earnings Call. [Operator Instructions] This earnings call is being recorded today, February 19, 2015. I would now like to turn the conference over to Mr. Nils Paellmann, Head of Investor Relations for T-Mobile US. Please go ahead, sir.

Thank you very much. Welcome to T-Mobile's Fourth Quarter and Full Year 2014 Earnings Call. With me today are John Legere, our President and CEO; Braxton Carter, our CFO; and other members of the senior leadership team, including our newly minted COO, Mike Sievert. Let's get to the disclaimer. We have another Un-carrier move today. We have a short disclaimer. During this call, we will make projections and statements about the future performance of the company, which are based on current expectations and assumptions. Please consider the risk factors included on our annual report on Form 10-K that could cause our actual results to differ materially from those in the forward-looking statements. In addition, we will comment on non-GAAP financial results on this call. You can find the reconciliations between GAAP and these non-GAAP results in our Investor Factbook on the Investor Relations page of our website. Let me now turn it over to John Legere.

Okay. Good morning, everyone. Thanks for joining us. Welcome to our -- the second Un-carrier earnings call and open Twitter conference. We've actually added a live video stream here from the New York Stock Exchange. And on Twitter, you're going to get to see what it's like right here in the room with the full behind-the-scenes experience, as harrowing as that is, sort of like one of those restaurants with an open kitchen where you get to see the chef prepare your meal and decide how you feel about that. But we're going to keep pushing the edge and making this a true Un-carrier experience for everyone. We'll generally go with the same Q&A approach as last quarter. However, we did learn last time that to accommodate more of your questions, we're going to extend the call for, and I'd be clear about this, up to 90 minutes and take questions via Twitter, text and on the phone. But certainly, if after 17 minutes, you are completely happy and the stock is going up considerably, we'll feel free to terminate it at that point in time. You're going to see in the video that our CTO, Neville Ray, is not in the room today. He's joining us remotely since he's out testing remote venues' and destinations' network coverage, which is a long way of saying he's skiing somewhere today in an undisclosed location. So be safe out there, Neville. Let me give you very briefly some of the highlights of our really fantastic results. The net is the Un-carrier revolution continues. 2014 was a record year of growth as T-Mobile continued to be the fastest-growing wireless company in America, and we really blew away all of the competition. Our 8.3 million total net additions clearly demonstrates the continued power of…

Hey, thanks, John, and good morning, everyone. Let me give a quick snapshot of our financial results. Our industry-leading customer growth is translating into strong financial performance. With an adjusted EBITDA of $5.64 billion up 6% year-over-year, we achieved our guidance even while blowing away our customer growth expectations. In fact, we were the only major U.S. wireless carrier with expanding sequential EBITDA margin in the fourth quarter. Once again, we led the industry in revenue growth with year-over-year service revenue growth of 13.6% and 19.4% total revenue growth in the fourth quarter. We've also delivered on the MetroPCS synergies. We expect to decommission all of the remaining CDMA markets by the second half of 2015, and we expect to incur additional onetime network decommissioning costs in the range of $500 million to $600 million with substantially all the costs expected to be incurred in 2015. Total onetime network decommissioning cost, CapEx and OpEx, since the acquisition of MetroPCS, are expected to be between $1.5 billion and $1.7 billion, which is $600 million to $750 million lower than the original synergy guidance given upon the formation of TMUS. The total NPV of synergies is now expected to be between $9 billion and $10 billion, up from our original projections of $6 billion to $7 billion. We expect to reach full run rate synergies of at least $1.5 billion by 2016. We have a strong outlook for 2015 that balances growth and profitability. We see continued momentum for the Un-carrier and are targeting 2.2 million to 3.2 million postpaid net additions in 2015. At the same time, we are targeting adjusted EBITDA of $6.8 million to $7.2 billion, which represents an increase of approximately 25% at the midpoint. Cash CapEx is expected to be in the range of $4.4 billion to $4.7 billion, slightly up from 2014. I would like to point out that adjusted EBITDA in the first quarter of 2015 is expected to be significantly impacted by a large investment to front-end growth in 2015 just as we did in 2014. In addition, the first quarter will reflect the accounting treatment of Un-carrier 8.0: Data Stash, which is expected to have a noncash impact in the range of $100 million to $150 million. The accounting treatment of the initial 10 gigabyte allotment from Un-carrier 8.0, which is a noncash revenue deferral, is expected to fully reverse itself during 2015. Rather than going on about such a great year, let's get onto your questions. You can ask questions via phone, text message or via Twitter. We will start with a question on the phone. Operator, first question, please?

[Operator Instructions] We'll take our first question from John Hodulik with UBS.

Just a couple of quick ones. First, John, as you look out to the competitive environment in '15, how does it compare to what you saw starting out 2014? And then the 2 million to 3 million net adds you guys are calling for, for this year, I mean, can you guys do that and still see improving ARPU trends at the same time? And then I guess, lastly, first quarter of last year, you had a huge quarter, I think, as a result of the ETF from Un-carrier plan. As you look out into this year, you've got a strong momentum, you've got the Data Stash. Can we expect to see a similar quarter from a net add standpoint in the first quarter of '15 that was on '14?

All right. I'll start talking about the competitive environment, and then I'll let Mike weigh in on questions 2 and 3, and we'll all chime in on him. The competitive environment into '15, obviously, is intense. The difference between '14 and '15 is going into '14, there was a question about what will happen? What will Sprint do with their network? Will they come out and fight? Or will they keep the -- pardon us while we redecorate sign out there? Will AT&T and Verizon respond? And I think all of that played out as you would expect. We're in a similar spot. We're still waiting to see what Sprint is going to do with their network. However, they're swinging the bat pretty hard, trying to get some activity flow. And I think AT&T and Verizon played really hard, and they felt the pain really badly. In Q4, I think the hand on the hot stove by the young child didn't feel pretty good, and they're taking the hand off the stove. So it's an interesting move into '15 because I think what T-Mobile has shown is it's not about what we're doing until somebody else responds. We've got a truly differentiated approach to the wireless industry that customers are responding well to. Our consideration is up a great way. Our share of gross adds is up considerably. Our brand value is up tremendously, and there's plenty more to do. So going into '15, I think the competitive environment is intense. We're prepared for it. We're thriving on it. As I said, our postpaid porting ratios last year with 2.15 overall. They are stronger so far, I think, through the first 1.5 month, and it'll continue. And it's about brand and it's about Un-carrier. And I think there's a bit of schizophrenia on the other guys that they're going to have to sort out. "Hey, we're never going to lower our self. We're not going to compete, they're trying to take our low end." That was Verizon, and then a couple of years later, they tried to lower their low-end prices and raised their data bucket prices. I think AT&T is working on so many other things. Somebody needs to remind them that they've got a U.S. wireless consumer base. And we're rooting for Sprint. We need Sprint to help us give -- take a few shots at the big guys and cause a little churn in the industry. And churn is good for us. So that's off the top of my head. But whatever it is, either they continue to fight and we continue to aggressively grow the way we are. Or they laid out and moved a few share points to us, and we're okay on either front. But Mike, do you want to talk about the...

Yes. I think what's the best thing about the competitive environment that we're facing right now is that our data is crystal clear, that people are not choosing T-Mobile because of price. As John said, they're choosing it because of the overall value proposition that we offer as the Un-carrier, and that's fascinating. Because if you were to ask the big guys whether or not there's a price war on, they're likely to say -- they'll try to downplay it, but the truth is they're likely to feel over there like there's a price war going on. Because if you've been sitting around like they have, charging too much, overcharging, over-monetizing customers and treating them the way they treat them, then when we come in with a more rational value proposition, it sure feels like a price war to them. From where we sit, not at all. In fact, people are choosing us because of the rounded Un-carrier value proposition that we have, which kind of -- it makes it interesting in comparison to Sprint, who has really focused, since they began playing harder last summer, on price. Just price, price, price. And what's interesting is this category is so important to consumers that that's just not enough. I mean, this is something we're not willing to make compromises and trade-offs on something as important as wireless. And so we've struck a nice balance here between focusing on the fastest 4G LTE network, a great experience, and then Un-carrier value proposition that's about solving their wireless problems, not just about low price. And that's really attracting people. The numbers speak for themselves with 4 million phone net, substantially all of the phone nets in the industry. And John, you also asked about ARPU. Do you want to jump in on that one, Braxton?

Yes, I think that, John, one thing you need to take into account is disclosures that we put out about the Data Stash and the 10-gigabyte allotment. That is a noncash revenue deferral that impacts the first quarter, which will have a corresponding impact on ARPU. But it's very important to note that, that will reverse completely through 2015 as that is actually utilized. And of course, that 10-gigabyte expires at the end of the year, so there will be no impact at all on 2015 ARPUs. Now once you take that into account, the one thing that we need to be aware of is that we have a tremendous focus on increasing family plan, activations with the Un-carrier. And we're going to do that in a very, I think, prudent manner that creates a lot of value throughout the year. But that can be decretive to ARPU at given points in time, given what we're doing from a promotional standpoint. But from a holistic standpoint, that is very accretive to EBITDA. When you're looking at the NPV of those additional family units coming on and the different acquisition costs relating to it, it is absolutely the right thing to do for Un-carrier. And we will -- again, we're not going to share competitive future moves, but it's something that we all need to be aware of. And if that does happen, there's definitely a benefit to the model in that we all know that family plans are much more stickier, are much more accretive to value creation. So yes, we're very, very optimistic with what we're seeing for 2015.

And just lastly -- as you say, given the momentum you guys are seeing, could you do 1 million plus net adds in the first quarter similar to what you did last year?

The first quarter of last year was significantly north of 1 million on postpaid phone adds. Of course, we said that we're making a very large investment at the beginning of the year, and we're very pleased with what we're seeing develop. Getting to the level that we had in the first quarter of '14, and if you remember, we had Un-carrier 4.0, which was our ETF offering. That's going to be tough because there's a lot of embedded demand for switching that immediately got triggered when we did that. But it's fair to say that we're very optimistic about what we're seeing for the first quarter.

John, it's interesting, the component what you'd said. I don't want to go too deeply into this. But I would tell you what we've learned in our business is that we could do 1 million net adds any time we choose to at any point. And what we refined our skills on recently in Q4 is the ability to manage growth and profitability to our liking, which is a beautiful spot to be in from a standpoint of managing and balancing growth when you want to grow and how you want to grow. And so it's very exciting for us. But appreciate your help. Let's go to -- let's take one more on the phone, and then I'll jump around and do some of these [indiscernible] of Twitter and other questions coming in.

We'll go next to Simon Flannery at Morgan Stanley.

John, you made some management changes yesterday. I was wondering if you could just provide a little bit of color about what you're trying to achieve there. And then Braxton, a good news on the synergies, $1.5 billion in '16. How much of that is flowing into your guidance for 2015?

Yes, thanks. I publicized a number of the changes that we made yesterday. And just very quickly, what they are is a -- it's a redefinition of my senior leadership team in a couple of ways. So one is raising up to a senior leadership team level directly, both the Retail leadership in Ami Silverman as well as Customer Care and service direct on the team in naming Jon Freier. We then also named Mike Sievert as Chief Operating Officer of the company and acknowledging the great work that he's done, but also acknowledging a continued need for a much more focused Chief Operating team to focus on the next level of Un-carrier growth. In that organization, also reporting to me and reporting to Mike, we expanded Tom Keys' responsibilities, who, as you know, is the MetroPCS leader who's done an incredible job and named him the President of T-Mobile Indirect, giving him all Indirect responsibilities as well and having him work with Mike on the trade-offs, et cetera, required there. And then key move behind that is -- behind Mike as the Chief Marketing Officer of the company, also, on the senior leadership team is Andrew Sherrard. Andrew, actually, was here as the acting CMO preceding Mike and I. The mystery will be out soon that a lot of what we did actually, Mike and I stole from Andrew, who had the ideas when we got here. So that's a few of the moves, and we can talk more a lot about that, but it's a great focus. One thing I would say is Jim Alling, who's -- was the acting CEO when I got here and was the operating lead for the T-Mobile site. He'll be moving onto some other opportunities, and we're taking some time also. He's very loved in the company and thank him for all the great work that he's done. But thanks for bringing it up.

Yes, Simon, on your other question, I'm just -- to kind of toot the magenta horn here for a minute. In the history of wireless, I mean, I think this is textbook M&A integration. We have transitioned all but 1 million of the legacy MetroPCS customers off that CDMA network onto the highest speed network in the country that Neville and his team have built. And we've done it with estimates of losing 3,000 to 4,000 customers. The integration has been seamless, and it's also been significantly accelerated over the original timeframes that have been laid out. And it's that acceleration plus a significant beat on the cost to achieve that's driving another $3 billion worth of total NPV of synergies into our business. We will not reach the run rate synergy realization until 2016. That's because we will have all the networks decommissioned. You saw we just shut down Atlanta and Detroit. All the California markets were shut down in the fourth quarter, plus some others. And the issue here is you have to completely decommission those CDMA networks before you can start realizing the synergy benefit from that decommissioning. So not all of it happens in 2015, but it's fully embedded in our EBITDA guidance of $6.8 billion to $7.2 billion, a partial run rate of that synergy. But I think the important thing to note is we'll be $1.5 billion or over for 2016, which we're very, very excited about.

So basically, there's more synergy to come '16 over '15?

Absolutely.

Okay. I'm going to jump to a few quick ones in the Twitter feed. This may be a Mike -- I'm not sure, which feed it is, but I think it's Jeff -- @jeffpas2. Any future plans working with BlackBerry? And I would just -- we don't have a lot to report. I would say that we are having discussions with BlackBerry. We're very optimistic we have nothing to report at this time, but I think both we and BlackBerry understand that there is a hardcore zealot of T-Mobile fans and BlackBerry fans that want to see that 2 of us do something together. That message has been received. John and I have spoken, and our teams are trying to find a way to make that work. So nothing to announce, but we're positively disposed on the topic. Okay, let's see. Yes, just a quick one here too, as well. Can you give any color in the uptake other Personal CellSpot offering? Mike?

Yes, we're well on track. This is something that we launched in September of last year called Wi-Fi Un-leashed, and it has several components to it, one of which is the Personal CellSpot. We said at the time that we would do at least 1 million Personal CellSpots well-placed to give great coverage to people in all kinds of nooks and crannies of the country, including their basements, and that -- it's just been wildly popular. So that's a trajectory that will be easily achieved. And probably as importantly, what we did on the same day is we announced that every phone that we carry in the T-Mobile stores will either, at the time of the launch and shortly thereafter, support Wi-Fi calling. And that's been something that our customers have responded incredibly positively to. Because people know that despite what the wireless industry would try to make you believe, that there are places, whether it's basements or out in the woods or faraway places or certainly overseas and doing travel, when Wi-Fi connection is there, but cellular connection either is indoor, is hard to get or hard to pay for. And so we're really proud of this. We're the only one supporting it across the board. We're the only ones with it, for example, on the i Phone 6. It's a real differentiator.

Okay. Before I take the next Twitter question. Let me just do a technological check and see, Neville, if you're there. If so, please speak.

Yes, I'm good, John.

Okay.

With you guys and hear you loud and clear.

Okay. So there's a number of questions coming in. I'll just read one of them from Christian Prenzler. But Neville, why don't you use this for a quick, and I reiterate that term, update on what's going on with the great work that you all have done in the network. But the question that came in from Christian is, "Hi, everyone. How has the 2G to LTE expansion been versus expectations, cost, time, et cetera?"

Yes, I think that's a great place to start, John. I mean, the acceleration and the momentum we have on our LTE expansion is [indiscernible] delighted to see it coming at the end of last year [indiscernible] target in place. And to the heart of the question just raised, I mean, the traction [ph] on our footprint came from 2G to LTE conversion in the 1900 MHz band. That momentum continues. We look to be at 280 million by midyear, if not the full. And you mentioned in the opening comments, the goal for the year is 300 million covered POPs of LTE. That's a pretty remarkable story, considering that we had nothing, if you went back just about 2 years ago. And that is going to be, I think, pretty stunning in the marketplace. It's all of the [indiscernible] geographic expansion of our LTE footprint in a matter of months. It will put us on par geographically or very damn close with the Big 2, and that goal is in sight for us. We have a lot going on with the combination with Metro that Braxton referenced. That's been just a tremendous program for us. We're into -- we're well along on the back 9 here with New York and Miami left to go. The synergy piece that I'd love from that deal has been our ability to exercise the combination of the spectrum. And 75%, 3/4 of that spectrum, now being used on the TMUS network and more to come. Think about more spectrum coming over to T-Mobile usable today in AWS-1 and big markets like New York and Miami in the first half of this year. No waiting on Spectrum to clear from auctions for T-Mobile. We're going to be adding to our LTE strength as we move through just the first half of this year, let alone second half. So a lot going on, very excited about the expansion of the network, the performance, and we love that fastest LTE crown. And game on. Let the competition try and catch us.

Okay. I'm taking now a Twitter question because one of our prolific followers on Twitter, @waltBTIG, Walter Piecyk is -- I think I've seen at least 27 questions from Walt. So before he beat somebody where he is, we'll take one of them here, and maybe we'll see him in the other queue. But this question says, "Phone ASPs were up. Preference for higher capacity iPhones or EIP enabling, driving higher-end purchases?" You want to use that, Mike, to delve into what's going on there?

Yes. Fourth quarter, it's no surprise, was a huge quarter for everybody on high-end phones, driven by the launch of the i Phone 6. But for us, there were some particular dynamics. And one thing that's interesting to note, Walt, is that T-Mobile sold 28 million smartphones in 2014, over 30 million phones overall. We think with some of the vendors, that puts us at #1. We think we may be #2 overall, but Q4 was dominated by the i Phone 6 as well as the Note 4. And so we did see average selling prices go up. And we're attracting a different kind of customer. And that's been a journey that we've been on for over a year now since the Un-carrier really started to kick in to its highest gear in January of last year with the launch of Contract Freedom. What's happening is we're bringing suburban families who can afford multiple super phones, and these are Prime customers. You're seeing our bad debt rates fall, you're seeing our Prime portfolio continue to improve, and you're also seeing higher-end phone sales. So all those things are tied together, and it really shows how our brand has evolved over the past 1.5 year and the kind of customers we're now attracting.

Okay. And Walt, I'm sure we'll get more a lot more from you. Appreciate all you're following as well. Let's take -- go back to the phone operator.

We'll go to Phil Cusick at JPMorgan. Philip Cusick - JP Morgan Chase & Co, Research Division: So if I take your fourth quarter EBITDA number and multiply it by 4, I get to the midpoint of '15 guidance, which is pretty rare in the wireless industry. So one, can you talk about the puts and takes of getting that EBITDA number? It seems pretty conservative. And second, how do we move from there to free cash flow? You said that the drag from EIP is going to slow into '15. Do you expect to use the this other receivables to offset that? How should we think about it?

Yes, I'm going to turn this to Braxton, but I will just say there should be a big sticker on our earnings, which is do not multiply times 4. Do not extrapolate, divide by 4 for Q1. We are very confident on the guidance that we're giving, but if you look at last year, for example, the shape and the curve of what we do with our EBITDA in our investments throughout the year have somewhat of a predictable pattern. And I think Braxton will outline. There's a couple of very specific items in Q1 to look at. So the EBITDA growth, we feel extremely comfortable with, but simple algebra on how to put it into each pew in the church, that needs a little help. And Braxton, why don't you pick up on that?

Yes, sure. And I think that's right on, john. I think when we look at the shaping of the year, we should all be informed with how we executed in 2014. We're making a very significant investment of front-end growth in the year. As you've heard from the team and John that we're very comfortable with the momentum that we see so far in the first quarter, and that's the best time of the year to grow. You pay for that growth in year versus growth that comes onto the fourth quarter, where you just have the acquisition cost and no resulting margin coming in from those customers. We've already talked about the Data Stash 10-gigabyte gift element being a deferral out of first quarter that completely reverses on the year and has no impact. But I think when you look at the year in total sales, what we've done here is establish a reputation for always meeting or exceeding our guidance. And the credibility that we get from doing that, we think, is very, very important, especially when you look at the shaping of activity throughout the year. We have a fairly wide range that we have given on our postpaid growth. Like last year, as we demonstrate growth throughout the year, we will tighten that range. And quite frankly, our aspirations are at the very high end of that range, if not higher. So all that needs to be taken into account when you look at the overall EBITDA guidance that we've given. On your other question -- and again, I think this is a milestone year for T-Mobile. When you look at what is implied by the guidance that we've given, there's very significant simple free cash flow accretion to this business. And when you look at it on a levered basis, we are net generating cash in 2015, which is the key to ultimate value creation. And the changes in working capital, and we have had a very, very significant on-balance-sheet investment on -- and our EIP. That's moderating because the base is now 89% penetrated, and we said the terminal penetration, because not all of our customers and partners can offer EIP, is about 90%. We're at 89% right now. Now certainly, there was a larger increase in the fourth quarter that was driven by the i Phone 6. So we definitely expect, on a fully levered operating free cash flow basis, to generate positive cash, which is a milestone. And I think it's a testament to the whole thesis that we've had with Un-carrier: Turn this into a significant growth platform leading to double-digit revenue, service revenue, reoccurring service revenue increases, which is now resulting in significant double-digit increases in the EBITDA and brings us fully levered operating free cash flow positive.

Okay. Let's go to the next question on the phone.

And we'll go next to Rick Prentiss at Raymond James. Richard H. Prentiss - Raymond James & Associates, Inc., Research Division: First, congrats, Mike. Well-deserved on the COO role. One more guidance question, then we'll probably move one from there. Braxton, I think from what I'm hearing, '15 should look like '14. We looked back to '14. We used the same phrase as you did. You blew away the net adds based on the original wide range of guidance, and yet you were able to really almost hang on at the low end of the EBITDA, even with blown away guidance. Should we kind of look at '15 being a similar thought process on how you guys plan things given the competitive environment?

Absolutely, Rick, and thank you for emphasizing that. As I said, our aspirations are significant for this year. But the positioning of our EBITDA and everything that we continue to do from cost transformation, the MetroPCS synergy starting to layer in, we're highly confident that we will deliver EBITDA at a very nice place within this range even with higher growth. So absolutely.

I think you've got a really good handle on it. I think our competitors in the industry seem to think of a lot of what we're doing all at the same time as phases that they do one at a time. Now we have a significant constant cost-reduction program going on, and we reduced cost by over $1.1 billion last year. We continue that every single week and will. There's always further cost to reduce. At the same time, we're aggressively investing in our network and IT capabilities and growing, because our business is on a fast trajectory, plus driving profitability. So it's an -- these are phases for us. This is how we intend to run the company. And we said a couple of years ago what our medium-term goals were for revenue growth and profitability and cash, and we're dead on those, and we'll continue to update you on it. Let's -- I got to take one Twitter question that's coming in from Judah. It's at @Judahe. This is going to give you more followers than I think you've got in the last 2 years. His question is, "Any comments you can share on FCC's Title II plan and how it might affect your Music Freedom?" For those that everybody knows, that there will be an FCC vote on February 26. And from what we understand about it, obviously, we are big proponents of a free and open Internet. But I think the short of it is, it's a 300-page document that certainly we haven't been able to crawl our way through. But I'm comfortable that if passed, as we understand it, it will have no impact on Music Freedom. And relative to our competitors, I think we would continue to drive forward with our business as it is. So that will be a big event for us, and we'll keep an eye on it. Let's go back to the phone again.

And we'll go next to Brett Feldman at Goldman Sachs.

So based on what you were saying around the first quarter and how well it feels like it's going, this is going to be the second year in a row where your first quarter shapes up to be a very big quarter from a customer acquisition standpoint, which is the absolute opposite of what we've historically assumed the first quarter is supposed to look like. And so I'm just curious, what have you seen that has caused you to say, this is the quarter where we want to go hunting for customers aggressively when it seems that the rest of the industry tends to feel -- sit there a little less aggressive?

Okay. Well, let's just put a couple of things in perspective, then I'll turn to Mike, who will try to wrap it through. Remember now that we've had 7 quarters in a row, over 1 million net adds, right? And we've had 3 out of the last 4, over 2 million. So it's become a normal way of us doing business, and our share is still low enough that we see it continuing into the foreseeable future. Second is, what's also becoming apparent is our growth is not related to our competitor's actions. We have waited right through periods of their activity and inactivity and continued to grow. So it's directly related to how we choose to deploy our capabilities throughout the year. And obviously, as both Braxton and Mike said, Q1 getting a fast start is the most economically advantaged way throughout a year to get a return within the -- we'd certainly have started that, and we have more that we're going to do very early in the year. But Mike, if you want to jump in on that?

Yes, I would just add, it's a great time to play. And if you look at the fourth quarter, we showed a lot of discipline in the fourth quarter to keep things in balance. We posted great growth numbers. I mean, I -- and we're very pleased with our growth numbers. But we also posted a big EBITDA performance and kept things in balance. Why? Because the fourth quarter is a really expensive time to play. And it's interesting to us that our competitors don't seem to get that as they plowed all kinds of irrational money into the fourth quarter, and you saw the damage that it did. We didn't play that way. Now Q1 is a pretty good time to play. People are flushed with cash. In many cases, because of the tax effect, the competitive environment is moderated a little bit. Last year, we played hard. And of course, in a company that has fiscal years on calendar years, our investments that we make in Q1, even if they're significant, we can recoup within the year. And you saw our EBITDA shaping last year where growth was very big and EBITDA was light in Q1 and then it shaped through, and by the end, we had a very big finish on EBITDA and balanced growth. And that's something that we've been saying today as a shape that you can expect to be repeated again this year.

And just think about. So Q4 ends, dust settles, we all head into Q1. What happened? In Q4, Verizon and AT&T had 14% and 23%, respectively, increases in postpaid churn, unheralded increases in churn. And they both reported significant margin pressure. So it didn't feel very good. We are announcing a record year, great probability and growth in Q4. And I'll clue you in. I mean, from November 1 through mid-December, we were watching. And if you saw, Q4 is a little bit like amateur day. It's like the people that only go out on New Year's Eve. There's all the activity focused and through Black Friday. So even with them playing and us somewhat watching to make sure that we were balanced, I've already given you the result. Now we go into -- we left, we came out hard in the second half of December and we leapt into January with tremendous momentum, then started putting in a series of programs early in the year. And before you can catch your breath and see if they are going to respond to those, I think you won't have to wait later than March-ish for us to put the foot on the pedal again, which is just going to cause a series of meetings this week with all the new wireless CEOs, I think. Let's go ask -- we'll stay on the phone, we got a big queue there.

We'll go next to Michael Rollins with Citi.

The question. Curious if you could talk a little bit how you're proceeding with cost of capacity going forward. John, I think you've put up a blog last night talking about the auction. And as you look at the success you've had in growing customers to date, how do you think about the capacity that you have on your current spectrum position and platform of sight?

Okay. Why don't I let Neville start and maybe Peter in the room. But Neville, this time, don't use your Sprint phone.

How is that, John? Is that better?

It's a little better. Good. Keep -- stay on that. That's smart you switched.

Just for the record, I'm outside of the U.S. borders, John. So it's not our network, but there we go. No, I think, Brett, to your question, the capacity position we have, and we've talked about this at length. We're in a very good position with the mid-band spectrum portfolio that we have, and we've added to that during the auction. Although AWS-3 spectrum is not going to be in commercial use for some time. When I roll back to, we've combined the 2 most dense networks in the country between Metro and T-Mobile. The spectrum synergies, the site synergies, all of those capabilities are spinning off a lot of capacity that affords us to put the best LTE into the marketplace today, the most capacity and the most speed. The numbers speak for themselves. But, obviously, we're not sitting on our laurels. We have more spectrum to migrate from the Metro business, as I referenced earlier. We continue to work on our network densification over 12,000 DAS modes within business right now, and we continue to push there. Our first small cells' in place. We're pushing my mobile [ph] 2x4 and 4x4, which has significant capacity benefits. And then you look to '16, we're looking to start leveraging unlicensed spectrum with technologies such as license-assisted access. So a lot of capability in the ground for us. On top of that, we're adding 700 MHz this year. And that program moving extremely well, another 10 megahertz of great spectrum coming to bear. So we have a lot of growth ahead of us, but the capability on the network to maintain and support that and, at the same time, deliver that great performance that Mike talked about.

Yes, and I'll just add again. There'll be plenty of forums for us to talk about incentive auctions and Washington policy. And don't get me wrong, I'm not whining and waving the white flag that things won't continue the way they are. There are various forms of ways that we can succeed. What I'm really trying to put a light on for the United States consumer and for Washington itself is this competition that is happening, if you like it, you've got to do things to ensure that it will continue. I would submit to you that most of, if you take Verizon's investment in their network, and I don't know what that thing is they call that whatever it is, that name they gave -- XLTE. It's kind of a -- it's a fancy branding name for, "We woke up and invested in our network because speeds were slow." And in effect, most of those changes are coming because we forced them into it on behalf of the consumer. Now when you go out to these auctions, this low-band spectrum, this is a once-in-a-lifetime activity, there's no more coming. And they control the predominant share, and we just had an auction. And in that auction, if you take the players that are competing right now, that would be AT&T and Verizon, they controlled 93% of what came out when you move aside what this had. So going ahead, if you allow them, they will use one of their weapons, which is economic prowess and the ability to pass that onto customers, as a way to just control the tables. And it's one of those times where, if you look at all of Washington policy and the various auctions that take place, there were a number of things to accomplish. One of them happened. The trust backing up with $45 billion, which is really good for the country. It funds public safety, which was one of the issues. But they have as a goal something that hasn't been accomplished yet, which is to ensure competition continues to exist. And yes, this will play into multiple other policy issues associated with industry structure, et cetera. So I think it's something that the American consumer should watch and understand. And more money into Washington if, in fact, you think about it as nothing more than how much does AT&T pay, maybe they paid $6 per American consumer. And if they turn around and pass it onto them, that's not really the way it should be. So that's that front. No whining, just going to lay it out. Let's get the rules set. And with a good set of rules, we can have this fun competition game in perpetuity.

And if I could just follow up just real quick. John, do you look at DISH as a possible strategic partner or as a competitor? How are you looking at that entity today?

No, I mean, I would add -- I would put DISH in the same category as a lot of potential influencers in the wireless industry. And to the big guys, everybody's a threat, right? Google coming into the business is a threat, soft SIM is a threat, DISH coming in is a threat. To us, they're all great for increasing flexibility and competition. And the interesting part about T-Mobile versus AT&T and Verizon, their thought process on anything they need to do is that they go buy it. We become a standalone adjunct to many other versions of how the United States industry arranges itself for the next phase of competition. So I look at the spectrum portfolio and the video content, et cetera, that DISH has as a fascinating idea to consider. But most interesting is I'm very confident in the fact that, equally, those other players are looking at T-Mobile as a fascinating brand and distribution capability in an innovative group of people that could become a platform to them. So it's an exciting set of options that the company is in a great position playing a portfolio from. So no, I think DISH is a great opportunity, both for the country and for possibly T-Mobile.

I'll just add one last thing John since -- or Michael, since you asked the original question on the cost of incremental capacity. I'd say the answer is for us to put an incremental gigabyte to work, it's a lot less than our 2 major competitors, a lot less. And because our cost of capacity is predicated on the spectrum that we have per customer, which is the superior position to that of AT&T and Verizon. And if this spectrum auction that just finished validated anything, it validated the superior position in mid-band that T-Mobile already had going into the auction with the best portfolio in the industry and by far the best when you adjust for our size. So spectrum per customer continues to be an advantage for us, and that makes the cost of an incremental gigabyte lower for us.

One more on the phone.

And we'll move next to Jonathan Chaplin at New Street Research.

Two quick questions, if I may. First, John, I'm wondering if you can expand on the comments you just made with respect to MVNOs. It was really in the -- reported in the press that Google has an MVNO with you. I'm not sure how much you can comment on that, but I'd love your -- to get more insight into how you think about MVNOs in general, how you can partner with people like Google and maybe cable companies without undermining your own business. And then on the DISH theme. How open you would be to entering a network sharing agreement with somebody like DISH and how feasible that is for you with your -- with the way that you're network's constructed? And then quickly for Braxton. Your detractors or your competitors would say that in order to get the growth that you're reporting at the moment, you guys are digging deeper and deeper into the subprime base. And we can't see it in the bad debt numbers that you report. My understanding is that you guys just have a different approach to assessing credit, and I'm wondering if you could expand on that a little bit.

You sure that's all?

That's it. I said it all without taking a breath.

Let's -- let me jump around. I'm going to start by commenting on the last item that Braxton will answer after I go through some of the -- your preliminary questions. But yes, I think you had it right, our competitors/detractors. I -- my first comment is the longer that their answer on our success is fear uncertainty and doubt and financial markets kind of attacks, the better. Because they're really missing the boat, which I've said many times. If I woke up running Verizon or AT&T, I would immediately realize that my issue is with the customer. And with those capabilities, the day they wake up and realize that they just have to realize that they've abandoned their customers, their customers hate them and they're losing them because that's not what they're focused on, they may do well -- better, but this fear, uncertainty and doubt. I gave a stat last quarter that I'd reiterate and -- which is, if you look at all the customers that are porting from Verizon, 93% of them that are postpaid, so not taking, and 77% of them are prime, right? So if -- to those customers that are leaving, somehow you are the prime customer that this industry wants and they think that you're inadequate and they'd love you leaving. So if you're sitting over there, that's how they think about you. It's just not true. And frankly, I think that behavior and thought process open the door, for example, to Smartphone Equality that we announced this week. There's just some things that even we find that are just age-old bureaucratic, power military hierarchy thinking. But when you stop and an individual customers says to you, "Hey John, Mike, Braxton, I've been your customer for 7 years and I have never not…

John, it's Neville. If I could just jump in. I mean, the last time I looked, I don't think DISH has a network to share. So -- but we have a great one. And we have a great history combining technologies and we have a very clean band plan that allows us to host equipment very rapidly. So great opportunities for us to host somebody else's spectrum for sure. But Charlie [ph] does leave the network at some point in time. It does have build-out requirements. So...

Braxton, do you want to get the last piece?

Yes, John. So I think that you definitely highlighted the bad debt. And the right way to look at bad debt, because we've gone off balance sheet with part of our service receivables, is looking at bad debt plus the loss on the factor. I mean, that's a holistic view and the right way to look at it. And what you've seen is the last 2 quarters sequentially, the actual total dollars have decreased. And that's in the context of a rapidly growing business with more and more customers coming on. And the facts are the facts. Yes, we have some highly sophisticated credit mitigation techniques that we deploy. Over the last 2 years, we've actually tightened credit. We further tightened credit in the fourth quarter. We're very comfortable with the types of customers that we're bringing in. And remember, we're getting the vast majority of our flow from AT&T and Verizon. So I think John covered a lot of other aspects that put the spotlight on this issue. And -- but the facts are the facts. And we're actually having decreasing real dollar, total bad debt and loss on factoring. And that's a prime indicator of what we're doing.

Okay. We're going to jump now. I have to give on Twitter. You see, there's a skill here. As you know, I'm a prolific person on Twitter. But Walt Piecyk has the line of the day, Jonathan. I'm sure it's directed at you. And this is -- Walt's tweet is, "Too bad, analysts are not limited to 140 characters on quarterly call." Well done, Walt. You're the man. Okay. I hesitate to do this, but I'm going to do it anyway. There's a question coming in on SMS. And I'm going to be very brief on it. We can talk about it a lot later. Yes, I kind of wondered where those -- all right, I'll do it then. When do you expect to pass Sprint? And I've been very gracious on this. And as the year ended and people are saying, "Hey, he predicted he's going to pass Sprint and he didn't." Well, we did. That's the gig. Let me give you a little history on this topic. Going into 2013, Sprint had 55 million customers. At the end of sort -- going into '14, they had 55 million customers. Going into this year, they have 55 million customers. In that period, they lost 3.3 million postpaid customers as well. At that same time period, T-Mobile had 33 million customers. We merged with MetroPCS and went to 42 million customers. And we've since added 13 million customers to get up to, guess what, 55 million customers. But a little footnote I think you all should take a look at in Sprint's filings. In Sprint's filings, there's an industry standard that between 60 and 90 days on MVNO customers, if there's no usage or revenue, we all turn them off. Between AT&T and Verizon, it's at a 60- or 90-day. That used to be their policy for Sprint. They actually changed their policy to 6 months. And if you go to their filings right now, there are 1.7 million customers at the end of the year with no usage or revenue greater than 6 months. So do the math. But I decided I'm not going to bring that up today. Because at the run rate that we are talking about, by the next quarter or 2, the math will be easy enough for even Walt to figure out in 140 characters. Okay, let's go back to the phone then.

And we'll go next to Kevin Smithen of Macquarie.

There's been a lot of talk about use of unlicensed spectrum, both by Neville and by Verizon in the last few days. Can you talk about when those chipsets will actually be available? And is there concern over interference from Wi-Fi and other uses on that on those bands? And how much capacity can this really free up for you over the next several years?

Okay. Neville?

Yes, thanks for the question, Kevin. Just I'll be brief. I mean, it's a push into unlicensed primarily are our focus. And I think Verizon is on the 5 gigahertz band. There's a lot of spectrum there over 500 megahertz, a lot of it's underused. Or if used at all today, the approach is to be a very good neighbor with any Wi-Fi use that's in the band. And the timing, a lot of momentum in the industry from the chipsets, handsets, infrastructure guys. So we're looking early '16 to potentially have the first commercial products in market.

And you mentioned 12,000 DAS notes today. I mean, kind of think about the use of 5 gigahertz, how many small cells will you need to effectively utilize that spectrum long term?

It's tough to predict, Kevin, on those type of numbers. I think the first application that you'll see on 5 gig and LAA will be in building and it will be primarily in building commercial, but potentially consumer, too. The great thing is we will move to outdoor. The performance of LTE in the 5 gig band is significantly better, the radio performance, than what's seen with Wi-Fi. But it's early days to call out numbers, but a great small set opportunity as we move into '16 and '17.

Okay, let's keep on the phone. There's a big backlog.

And we'll go next to Joe Mastrogiovanni at Credit Suisse. Joseph A. Mastrogiovanni - Crédit Suisse AG, Research Division: A couple, if I could. One, are there any other attractive blocks of 700 A-Block spectrum still available on the secondary market? And then, Braxton, there's a significant level of cash on the balance sheet. Can you just talk about the funding requirements over the next couple of years and your ability to meet those requirements? What do you think is the right leverage for the company?

In -- let me start and ask Peter Ewens to briefly comment on a topic he could probably pontificate on until tomorrow. But Peter?

Yes, so just a brief comment on the A-Block. Look, we're always interested in A-Block. We said we'd be disciplined acquirers. We're going to stick to that. I think -- unfortunately, I think a lot of sellers now are going to have unrealistic value expectations. So we'll just have to watch the secondary market and see. I mean, we're interested in that spectrum. We look to acquire more, but we're only going to do so on valuations that makes sense for us.

Yes. So the second part of the question on funding requirements. Obviously, we showed a great deal of discipline in the AWS-3 auctions with a total spend of $1.77 billion. And looking at our year-end liquidity, we obviously have a lot of firepower on the balance sheet. When we look at our requirements over the next couple of years, I mean, we've made it very clear that looking at perfecting our low band footprint is a priority. And I'll reiterate right now, our long term guidance that we've had since the formation of TMUS is that leverage needs to be in the range of 3x to 4x. We're very focused on our ratings. And you get over 4x levered, you will definitely be in a position for ratings downgrade that is no interest to us whatsoever. Our leverage at the end of 2014 is 3x pro forma. For the final payment to the SEC for AWS-3 is 3.2x. But when you look at our leverage, given the guidance profile that we put out for 2015, we have a very significant opportunity to fund all and more than what we think our needs will be with internal cash generation and debt. There are no plans to do any additional equity.

Okay. Let's keep on the phone.

And we'll go next to Craig Moffett at MoffettNathanson.

I wanted to just sort of come back to this discussion that you've been having on the call today about Wi-Fi and small cells and things. When you made this, the decision to enter into the MVNO agreement with Sprint, our understanding is that it includes some measure of least cost routing and it also has a large Wi-Fi component to it where they're going to be taking traffic, in general, off the network. Can you just talk about how you think about the competitive risk that companies like Republic and FreedomPop and perhaps even Google pose to the economics of the macro cellular network when more of the traffic starts to go over Wi-Fi, and presumably more of the value in the eyes of the customers starts to be associated with Wi-Fi relative to where it is today?

Pete, do you want to start?

Yes, so I'll start. I think you said an MVNO agreement with Sprint. So I don't think we have any.

I'm sorry. I meant to say Google, I'm sorry.

So I just have a couple of comments. So first of all, with respect to Wi-Fi. I mean, we're not running away from Wi-Fi. We're running towards Wi-Fi. I mean, the fact of the matter is a great deal of everyone's traffic today is on Wi-Fi, and yet usage in our cellular network continues to grow by 50%, 60%, 70% per year. So we don't see Wi-Fi per se as a threat, we see Wi-Fi as a natural complement. And Mike can comment on the stuff we do with Un-carrier 7.0 and Wi-Fi Un-leashed, but we're really running towards and embracing it. As to the Wi-Fi-only offerings, they certainly will have a place and we're not against it. And we think for certain customers, it's kind of the equivalent of Lifeline cellular service. It's a -- if it's Wi-Fi-only, it's a modest functionality today. It will improve, but the vast majority of customers want to be able to connect anywhere they are. And so they'll -- although I'll play the role, and we're for -- we're absolutely for competition and proliferation in the market.

I think it shows on how we're different from our competitors, too. I mean, Neville just talked about how we are fully embracing unlicensed LTE as a major opportunity. We think it's a terrific technology. And we made a major deal last year out of Wi-Fi Un-leashed. And as Peter said, we're running towards it. We see some of these emerging players as potential compliments as part of the future and part of what consumers are looking for. If there are congested areas, if there are urban areas and Wi-Fi is there and it has capacity, why shouldn't your phone be able to attach to whatever is providing you with great capacity and great experience to not only conduct your data, but to make great phone calls as well? And we're really the only carrier that thinks this way about solving the problems of the customer, what the customer wants, where is the customer, how can we provide from all kinds of different technologies and resources the thing that solves their problem. And then we'll build our business model around it. And it's just the way we're wired as a company, it makes us very different from our competitors. And I think it's inherent in -- there's a lot of questions that relate to the cable players or to Google. And the questions get a bit specific about what the specific thing is that it sounds like they're launching and what our role is. And I think much broader, as I have been saying for well over 1 year or 2, that we need to think differently about the industry structure around serving the needs of the current wireless customers and the portfolio of what their requirements are. And you need to think about Google or DISH or Comcast or the other players as having ideas evolving that their existing customers want to dabble into areas that intersect with what we have. And as opposed to it being a threat, I think the reality is whatever it is they're envisioning trying to provide their customers, we have a significant greater portion of what that offer is and the relationship with the customers than they do. So it's a perfect opportunity for us to continue positioning this brand, positioning with our customer's innovation and solving their needs and then discuss with some of these other players as opposed to, "Oh my God, here they come." T-Mobile becomes a great example of how they may be able to accelerate their needs and expand ours. So again, looking over 5 years, these are all great opportunities for us to accelerate the momentum and to partner with other people and help solve their issues as opposed to worrying about digging our heels in. Okay, let's see. We're going to take one more on the phone, and then there's 2 I want to do on Twitter.

And we'll go next to Amir Rozwadowski of Barclays.

I was wondering, Neville, actually, if we could talk a bit more about the network improvement strategy here. If we look at the latest reports out of RootMetrics, what we've seen is a stark improvement with your network, particularly in metro areas. How should we think about sort of the overall expansion in terms of being able to build upon that improvement from a nationwide perspective as well as how that can filter into sort of enhancing the brand recognition even beyond what you folks have done so far?

Go ahead, Neville. I think that's a great question for you to cover.

Yes, absolutely. So I think, clearly, the Root data is starting to catch up with what we've been telling the marketplace for a year. And so there were some reflection of progress we've made in '13 and '14 in the recent results, but the testing still lags what we've really done over the last 3, 4 months. And in the metros, I mean, the top 30 metros, I mean, the Root data will tell you, I mean, we're just killing it. Nobody is close to us in terms of speed and performance in the top 30 metros. And we're actually winning the lion's share of the overall awards even from Root. I mean, we're a small second -- a minor second place to Verizon, but ahead of AT&T, and clearly well ahead of the Sprint guys. And so I think to your question, Amir, with obviously the expansion of the LTE footprint is our major goal as we move through '15. And to take that metro footprint where we've been really powerful and strong with the depth of LTE, expand that with the 1900- and 700-based LTE into more and more key parts of the U.S. And the geographic footprint expansion I referenced earlier is going to be extremely compelling. The areas where we've already upgraded our 1900 footprint and our 700 roll out in key markets like D.C., Minneapolis, Cleveland, Dallas and Houston, now are benefiting from 700 megahertz. The difference is really being melded. This is a very material game changer for us. We have a lot of 700 to roll out, almost 190 million POPs of licenses in the house today. 75% of that cleared or contracted to be cleared. So it's going to be a big year in terms of seeing that great performance that we've had in the metro areas expand into other key parts of the nation.

Excellent. And then just a quick follow-up on the prior commentary around the broadcast auction. In terms of funding for being able to support any additional spectrum, acquisition, it sounds like we should think that when that auction comes to fruition, you have sort of funding should be from ongoing cash expectations as well as potential debt funding. Is that the right way to think about things?

Yes, existing -- that is correct, existing cash plus debt. No plans for any additional equity.

Okay. Here is a Twitter question from T. Vola [ph]. With the popularity of Data Stash, do you see the program lasting beyond 2015, 2016 as a permanent? The answer is, yes. It's permanent. And I use this as a chance to reiterate that the Un-carrier moves are attempts to change the wireless industry structurally. It's an attempt to get everybody else to do it, so it's not a matter of wondering if they'll reply. And they're permanent, they're permanent structural moves. That's a commitment we make to customers. It's also something that explains why it bothers our competitors so much, because it's not a special, it's not a program. And by the way, it's not intended to have a short-term impact. As Mike said, one of the big tricks of what we're doing is that the Un-carrier and T-Mobile is all about creating change in a set of benefits and opportunities that are the brand that customers want to come to. And then things like Contract Freedom are a way to solve the barriers to get you to come where you want to be. And that's very different than the industry kind of norm, which is everything is about the special and everything is about the decision factor. And so yes, Data Stash is here to stay. And I think the verdict so far is one follower who didn't quite figure out what the issue was it's trying to be solved but had a cute name and some old patents that they wanted to get out the door, so they did it. So we'll see. But I think they'll all come around. My prediction is it'll take for one of the bigger carriers probably a year to figure it out, a little bit more pain. And so we'll see. But they'll come at some point. Okay. We're going to run out of time. Let's go to the phones one more time.

And we'll go to Colby Synesael at Cowen and Company.

Two, if I may. The first one, you talked a lot about front-loading the growth in the year and making a large investment. I was wondering if you could just provide a little more specificity on what that actual investment is? Is it simply just the cost of the promotions or is there something more there? And then also, as it relates to churn, we've obviously seen churn come down over the last year or 2. But it seems to be stabilizing now, at least on a seasonal basis. Is the churn number that we saw roughly in 2014 good proxies for what we should be thinking about for 2015?

Yes. So from an investment standpoint, it's an investment to drive additional growth. The growth certainly comes with acquisition cost. So it's a combination of anything that we do from a promotional standpoint plus additional volume, and that's the appropriate way to look at it. Yes, I'll pass it over to Mike to talk a little bit about the churn dynamics. We're seeing some very favorable trends so far in the first quarter. But with that, I'll hand it over to Mike.

Yes, just picking up on what Neville was talking about on the network transformation, I'll give -- my personal color is I've been associated with the wireless industry since 2002, the beginning of the year, and I've never seen a network transformation like what this team has pulled off over the last 2 years. And '15 will probably even outdo what Neville has done and his team have done over the last 1.5 year. And so we've got huge aspirations for network this year based on utilizing those 700 megahertz assets that were purchased, enrolling LTE to 300 million POPs from where we are. And so we really are optimistic about the continuing evolution on churn to your question. Now when's that benefit start to come in? We're not going to give you a lot of detailed thoughts. But this year, I think you can expect some modest improvement. And -- but in the long term, there's real opportunity for us. And here's the part that's interesting. We don't need it to make good on the promises that we've made to you and to our investors. Our model is based on the churn we've got. Now, again, I think we've got real opportunity. But our business model works at these levels, and that's because our cost structure is radically different than our competitors. What would happen if AT&T and Verizon were sustainably above one, like we saw last quarter? All hell breaks loose in their business models. It's just totally different for us. And we're a different company with a different model. We can make good on these promises and we see real opportunity here. And by the way, 2015 is off to a pretty good start on that metric.

Yes. Last item on that is, I would say, adding to it -- when we set out 3- to 5-year plans 2 years ago or so when we stepped into this. Churn is already better than we anticipated in our conservative assessment, it would be at the end of that period. So we've had a lot of success. So as Mike says, we can operate at these levels. Second is, there'll obviously be a seasonal decline in Q1 on churn that we're already seeing. But there's a very important part that Mike was amplifying. We get all social, et cetera, get all up in arms every time there's one of these Root reports, et cetera, and you can't change the experience that customers are having on a network by putting out a report. Sprint, right now, everybody knows their networks in trouble, and you can't change that with a report. And I speak from experience on this. Is 2 years ago or so, when we had no LTE, we have very carefully individually been working with every customers to raise their expectations as to when they can expect what in their experience with us, and we delivered. So the LTE deployment which are moved to 300 million has been very targeted ahead of plan. This 2G to 4G migration, we are giving customers specific location information as to when they will experience the change. And things like Wi-Fi calling, et cetera, it's just an understanding as to how to migrate that experience. And in the time periods, in the 2 years, and even in the short future where customers don't have the right experience, our track record of how we work with them, to move them off and to work with them as to when they come back is impeccable.…

And we'll go to Jonathan Schildkraut of Evercore ISI.

This is Justin for Jonathan. I was just hoping you could talk about the EIP financings and billings. And whether in 2015, if you see the billings overtaking the financings?

That's a great question. You can see that with penetration of the base now being about 89% on Simple Choice, that there's not a lot of additional significant EIP financing that will go on the balance sheet. Now in the fourth quarter, you saw an increase in EIP financing versus the run rate that we had in the third quarter and the second quarter, and that was really driven by the i Phone 6. So that definitely will moderate throughout the year. And the other part of the equation is the amount of what under classic accounting would be recognized as service revenues is now over $1 billion in the fourth quarter. So yes, the projections are that the billings will overtake new EIP at some point during 2015 with one caveat. If we once again blow away our growth projections and attract significant growth above and beyond what our current guidance is, that inflection point could potentially move out to '16. But it'd be solely a function of growth, and that's a high-class problem to have. Definitely appreciate your question. Okay. So thanks, everyone, for listening in. It's been great talking with you this morning. And we're looking forward to speaking with you again next week during the Deustche Telecom Capital Markets Day in Bonn, Germany. And we appreciate your time. Have a great day.

Ladies and gentlemen, this concludes the T-Mobile US Fourth Quarter and Full Year 2014 Conference Call. If you have any further questions, you may contact the Investor Relations or Media Department. Thank you for your participation. You may now disconnect, and have a pleasant day.

Bye-bye.