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NEW YORK—T-Mobile is now targeting small and midsize businesses (SMBs) to grow its own operations and revenue as the company continues its ongoing efforts to battle competitors by cutting prices and improving services for its customers.
In the last two years, T-Mobile has unveiled a series of what it calls “Un-carrier” events that have ended mobile contracts for consumers, removed overage charges, created rollover data capabilities and more, unlike the company’s competitors.
Now, the company has unveiled its latest iteration of its Un-carrier announcements—”Un-carrier for Business,” or Un-Carrier 9.0—which is all about bringing similar simplicity, increased value and improved services to customers who own, run and work in the millions of SMBs across the United States.
“We’re going to do for businesses what we’ve already been doing for consumers,” John Legere, president and CEO of T-Mobile, said at a March 18 press event in New York City, where the new strategy was announced. “Eliminate pain points and force change. The majority of U.S. businesses—a full 99.7 percent—have less than 500 employees and don’t have the money or resources to waste debating, negotiating and deciphering the carriers’ hidden pricing. Today, we’re upending how business buys wireless with 100 percent transparent pricing, the best rates, business family discounts and more.”
About $83 billion in revenue industry-wide in the mobile market comes from serving business customers among the four largest carriers, said Legere, Some $72 billion of that is spent with the two largest carriers, Verizon Wireless and AT&T, he said. Only about $3.8 billion of that market is captured by T-Mobile, with the rest going to Sprint.
With that gap in mind, T-Mobile is now moving to capture more of that market by offering mobile plans that the company hopes will attract new business customers and convince them to move over to T-Mobile.
Under the simplified Un-carrier for Business pricing, businesses will pay $16 per line per month for up to 19 lines of service, with each one including 1GB of high-speed data. Pricing for 20 to 999 lines is $15 per line per month, including 1GB of high-speed data per line, while pricing for 1,000 lines or more is $10 per line per month.
More data can be added as desired for $10 per user for 2GB of data per month. Larger “pools”of data are also available for purchase as needed, starting at $4.75 per GB for up to 100GB or $4.50 per GB for up to 500GB. Data pools of more than 1TB per month are priced at $4.25 per GB.
Business Services Also Included
In addition, the Un-carrier for Business program also offers SMBs a free and simple way to start their own Websites through a free dot-com domain and Website tools in a partnership with Web hosting company GoDaddy.com for all business customers who purchase data allocations from T-Mobile.
Business customers will also gain the ability to get branded email addresses for their companies, rather than generic Gmail or ISP-based email addresses through an arrangement with Microsoft that will allow customers to now have custom-branded email domains, according to T-Mobile.
Discounts are also available for the family members of new business customers so that they also can save on their phone plans.
T-Mobile Is Diving In to Better Serve SMBs
Meanwhile, consumers aren’t being left out of T-Mobile’s latest announcements.
Legere also unveiled a new “Un-contract” initiative that gives price lock guarantees to existing and new T-Mobile customers at their existing rates as long as they remain with the company. Customers who have unlimited 4G LTE services will lock in their rates for a minimum of two years, under the price guarantee.
Legere also announced a “Carrier Freedom” initiative that T-Mobile is offering to pay all outstanding phone and tablet payments up to $650 per line when customers switch to T-Mobile from a contract they hold with another carrier. Early termination fees for unexpired contracts will also be covered.
T-Mobile US has been on a bit of an upswing as of late. In February, the company announced that it had grown its fourth-quarter 2014 profit to $101 million, up from a $20 million loss in the same quarter one year prior, while increasing its fourth-quarter revenue to $8.15 billion, up 19.4 percent from the same quarter in 2013. The company also tallied a 4.05 million net add in postpaid mobile customers in 2014, giving it 25.8 million customers, which is up 18 percent from 21.8 million one year prior.
T-Mobile’s branded postpaid mobile phone churn rate for the fourth quarter was 1.73 percent, compared with the 1.63 percent churn rate one year prior. For the full year, the company’s churn rate was 1.58 percent, which was down from the 1.69 percent rate in 2013.
In the fourth quarter, T-Mobile sold 8 million smartphones, up from 6.2 million in the same quarter one year prior. For the full year of 2014, the company sold 28 million smartphones, up from 18.3 million in 2013.
In January 2015, T-Mobile unveiled new, cheaper prepaid mobile phone plans for customers who want service without paying extra for such features as free international texting and free music streaming. Starting at $40 per month, the new Simply Prepaid plans, with monthly 4G LTE data allotments of 1GB, 3GB or 5GB, give customers more choices for services that better fill their needs. All three Simply Prepaid plans offer unlimited data, talk and text. All data use beyond the monthly 4G LTE allotment is provided at lower 128K speeds under the plans. The new plans are priced at $40 per month for the 1GB accounts, $50 per month for 3GB accounts and $60 per month for 5GB accounts.
In 2014, T-Mobile was the apparent target of several merger attempts. In October, French telecommunications company Iliad announced that it had ended its acquisition attempts for T-Mobile, while in early August Sprint dropped its plans to buy T-Mobile after the move was opposed by regulators, according to reports. Sprint had been rumored for months to be seeking a merger with T-Mobile so that the two struggling companies could join together and fight harder to compete with mobile powers Verizon Wireless and AT&T. Iliad wanted to buy T-Mobile US to bolster its global aspirations.
T-Mobile’s most recent financial results were in contrast to the latest results from competitors Verizon, AT&T and Sprint, which all suffered losses. Earlier in February, Sprint reported a net loss of $2.4 billion in its third quarter of 2014, which was more than twice the loss of $1.04 billion one year prior. Sprint also had an operating loss of $2.54 billion, which included non-cash charges of $2.1 billion.
In January, Verizon reported fourth-quarter losses of $2.2 billion, largely due to the cost of non-operational expenses, including benefits and pension payments, according to an earlier eWEEK report.
Also in January, AT&T reported a net loss of $3.9 billion in the fourth quarter of 2014, though its revenue of $34.4 billion rose 3.8 percent from the same period the previous year.