The nation’s fourth-largest carrier continues to experience the side-effects of remaining the sole major U.S. telco without Apple’s popular iPhone. The company this morning reported third-quarter earnings and the results are depressing. It lost 492,000 contract customers, down from the 557,000 loss in the June quarter but also up over the year-ago quarter when it reported loss of 389,000 contracts.

As a result, revenue for the quarter shrank to $4.9 billion, a 6.4 percent decline, while service revenue experienced an 8.7 percent drop…

T-Mobile ended the quarter with 33.3 million customers.

A media release points the blaming finger directly at the iPhone 5 launch, which has caused some customers to defect to rival AT&T, Verizon and Sprint, which all carry the sought-after device.

T-Mobile’s 4G network modernization plan is “well underway”. The company began lighting up first HSPA+ markets in Q3. The speedy, iPhone-friendly 1900MHz HSPA+ service is now available to customers in five major areas: Las Vegas and Kansas City, in addition to Washington D.C., Baltimore and Houston markets.

The company also added Nokia’s Lumia 810, two Windows 8 smartphones and Samsung’s Galaxy Note 2 to its device lineup, upping as well its advertising expenditure to pay for flashy commercials which wrongly promote 3G HSPA+ network as “4G”.

http://www.youtube.com/watch?feature=player_embedded&v=pczODHEO23I

Here’s another one.

http://www.youtube.com/watch?v=gfLD4rx0Ffs&feature=plcp

The carrier last month announced a merger with MetroPCS in an effort to grab Sprint’s prepaid market share. The combined spectrum holdings of T-Mobile and MetroPCS will enable a deeper LTE network deployment, “with a clear path toward at least 20 by 20 MHz of 4G LTE in many areas of the country”, the carrier maintains.

T-Mobile also launched new unlimited data plans in the quarter and briefly made noise with its Bring Your iPhone campaign in the hope that offering free support to unlockers and 4G Micro and Nano SIM kits would persuade unlocked iPhone owners to sign up for unlimited data.

Advertising-wise, the company went from this…

…to this.

Obviously, none of the above was enough of an incentive to keep folks from defecting to Apple-friendly carriers.

I guess that iPhone 5 response plan didn’t work as planned…