T-Mobile Uses Aggressive Pricing, Free Roaming to Overtake Sprint

NEWS ANALYSIS: Feisty T-Mobile uses pricing, features and service to pass Sprint as the nation's number No. 3 wireless carrier, while turning its attentions to business customers.

T-Mobile Tops Sprint 2

T-Mobile has finally achieved the third-place status that CEO John Legere promised would happen in 2015. The quarterly performance numbers issued by both companies showed that T-Mobile had about 1 million more subscribers in the second quarter of 2015 than the previous No. 3company, Sprint. This means that Sprint now drops to fourth place among national wireless carriers.

T-Mobile has 58.9 million customers, versus Sprint's 57.7 million customers. In addition, T-Mobile results show the company growing at a faster rate than Sprint, despite Sprint’s recent turnaround in network performance.

But can T-Mobile keep it up? T-Mobile reached the third-place ranking through a combination of lower prices than its competition, more aggressive marketing and a series of service features that made the carrier more attractive to potential users than the other companies.

Those attractive features include allowing music streaming that does not count against data caps, free roaming throughout North America, free data roaming nearly worldwide, and subsidizing the costs of customers from other companies that want to switch to T-Mobile.

But Sprint has taken a "me too" approach to most of T-Mobile's efforts, offering its own subsidies for switching and providing similar incentives in terms of roaming charges. What Sprint hasn't had and still doesn't have is a high-speed data network to challenge T-Mobile.

Sprint, unfortunately, came out on the short end of the 4G wars of a few years ago. Verizon and AT&T both launched LTE networks, while T-Mobile went with HSPA and Sprint went with WiMax.

The difference is that T-Mobile used HSPA as a bridge to LTE, while Sprint stuck with WiMax until it became clear that it was a technological dead-end. Sprint is in the process of shutting down the WiMax network, a task that should be completed by the end of 2015.

For Sprint, this sidetrack into the WiMax wilderness delayed a move to LTE and while Sprint is now well into rebuilding its 4G network, this time as LTE, it's far behind everyone else.

Even worse for Sprint, the company's one-time edge as a preferred business carrier was put in peril when the company jettisoned its Nextel service. Nextel was a favorite in some vertical industries such as construction and oil services as well as for emergency first responders because of its push-to-talk two-way radio capability. Now Sprint has replaced that with a service that users have reported as being less responsive.

Meanwhile T-Mobile has broadened its marketing approach by reaching out to business users, especially small- and medium-sized business with what the company calls T-Mobile @Work.

Wayne Rash

Wayne Rash

Wayne Rash is a freelance writer and editor with a 35 year history covering technology. He’s a frequent speaker on business, technology issues and enterprise computing. He covers Washington and...