T-Mobile Outage Silences Boastful Upstart, and Brings FCC Probe

(Bloomberg) -- T-Mobile US Inc. had its first big network meltdown since leapfrogging AT&T Inc. to become the No. 2 wireless carrier in the U.S., and the company’s response has been uncharacteristically quiet.

As many as 68 million of T-Mobile’s wireless customers had their service disrupted for several hours Monday as the company tried to identify the problem and restore service.

The company said the outage was caused by “router” issues. T-Mobile’s parent company, Deutsche Telekom AG, said Tuesday that it was related to 5G network upgrades. But the carrier is still sorting through the chain of events that caused the breakdown and has yet to provide an update. In the meantime, the Federal Communications Commission has vowed to investigate the matter.

It’s the first big test for the new company, which absorbed Sprint Corp. in April after a two-year battle for regulatory clearance. And it puts the company’s new chief executive officer, Mike Sievert, in the spotlight -- though, for now, he has yet to comment on the causes of the problem. (He has retweeted remarks from his technology chief and told customers on Monday that he appreciated their patience while the company worked on the issue.)

“The T-Mobile network outage is unacceptable,” FCC Chairman Ajit Pai tweeted Monday evening when he announced the agency would launch an investigation. “We’re demanding answers -- and so are American consumers.”

At 1:03 a.m. New York time, T-Mobile’s technology head Neville Ray tweeted to say service was fixed.

The timing is especially awkward for T-Mobile, since it just spent two years assuring regulators that joining forces would Sprint would bring a robust network. But it’s not uncommon for the FCC to probe outages. Regulators look for ways to prevent future problems and hand out fines for some mishaps.

After a CenturyLink Inc. fiber-network outage in December 2018 caused more than 12 million blocked or degraded phone calls and at least 886 dropped calls to 911, the FCC issued a report and didn’t fine the company.

As many as 22 million customers in 39 states were affected by the outage, which lasted almost 37 hours and was caused by a malfunctioning switching module, according to the Aug. 19 report. Pai said the FCC planned to reach out to telecom providers to promote best network practices.

The FCC in 2018 settled an investigation into widespread outages of emergency 911 calling for AT&T’s wireless customers, saying the company agreed to a $5.25 million fine and changes in its system to reduce the likelihood of outages.

CenturyLink agreed to pay a $400 million civil penalty and enter into a compliance plan after a 911-calling outage in August 2018, when a technician made an error during the course of a routine configuration change.

Anne Veigle, an FCC spokeswoman, said the agency had no comment beyond Pai’s Monday evening tweet.

T-Mobile is known for its brash marketing, and Sievert has been a big part of that. As chief marketing officer and later head of operations, he orchestrated the “uncarrier” campaign, which featured no contracts, unlimited data plans and free taco Tuesdays. The promotions helped attract millions of new subscribers.

But now the company has what it wanted -- the scale that came with the $26.5 billion Sprint deal -- and the pressure is higher to show it can be more than an upstart.

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