When T-Mobile unveiled its latest T-Mobile for Business “Un-carrier 9.0” plans on March 18 in a glitzy announcement in New York City, the company didn’t forget about its everyday consumers either.
While the company was handing out special low pricing for mobile service for small and midsize businesses across the United States, with rates starting at $16 per month per line, including 1GB of 4G LTE data, T-Mobile was also unveiling new programs aimed at consumers, starting with guaranteed rates forever and payments of up to $650 per line to buy out a new customer’s existing smartphone payment plan from either Verizon Wireless or AT&T.
The latest T-Mobile offers, which the company says it hopes will continue to differentiate it as the Un-carrier in a marketplace of traditional mobile carriers that offer higher prices and fewer services, are part of the company’s strategy to bring in new customers and keep them with T-Mobile for the long haul.
T-Mobile’s colorful and frenetic CEO, John Legere, said that under its new “Un-contract” initiative, customers under T-Mobile’s no-contract smartphone plans won’t have to face any price increase for their services as long as they remain with the company. Only customers who have unlimited 4G LTE services will be exempt from that price guarantee forever, he said, adding that even those customers will, at least, lock in their rates for a minimum of two years. Legere said unlimited accounts will be reviewed at that time and it is possible that prices will be adjusted.
In T-Mobile’s new “Carrier Freedom” initiative, customers coming to T-Mobile from Verizon or AT&T will be eligible to have all their outstanding phone and tablet payments paid up to $650 per line so that they can leave their previous carriers and switch services. T-Mobile will also continue to offer up to $350 in payments per line for new customers who switch to cover their early termination fees (ETFs) for unexpired contracts with Verizon or AT&T, said Legere.
“Right now, there are about 29 million Americans stuck on device payment plans” with Verizon and AT&T, said Legere. “The emails and the social [media communications] that I’m getting [from many consumers in the marketplace] are saying that ‘we love what you are doing, but I’m stuck on a contract,'” he said. “So we are introducing carrier freedom to cover all outstanding phone payments and leases. So people are truly going to be carrier-free.”
That same kind of thinking is what led to T-Mobile’s new price guarantees, said Legere. “I hate contracts, you got that from me the day we met,” he said. “When we got rid of contracts, it was the happiest day I ever had.”
But for many consumers, price increases are as big a worry as contract lock-in, he said. Some 62 percent of consumers have had their rates raised by carriers or are nervous that it will happen in the future, he said. That’s why T-Mobile announced its price guarantees, making all of its promotional and fixed rates permanent, he said.
“I’m going to sign a contract to you with my name on it that your rates may go down but they won’t go up,” said Legere. “If you’re on a promotional rate, it just changed to permanent pricing. And consumers don’t need to worry.”
The changes aimed at consumers followed a host of business-aimed ventures that T-Mobile said it hopes will grow its services with millions of small and midsize businesses across the nation. 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 and AT&T, with about $6 billion going to Sprint and the remaining $3.8 billion going to T-Mobile. With that gap in mind, T-Mobile wants to now 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.
“I think most of [that gap] is from a lack of focus,” said Legere. “I think it could have a very big impact” if the company goes after it strongly. “We need it to be different, though.”
What T-Mobile’s Latest Mobile Deals Mean for Customers
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.
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.
T-Mobile will also create a specialized 24/7 customer care center for small businesses so they can get help when they need it, according to Legere. Business customers will also be able to pass on discounts to family members so that they also can save on their personal phone plans with savings up to about 50 percent.
“This is a not a diving ‘Hail Mary’ pass for us,” said Legere of the new initiatives. “We are expanding like crazy. This is logical planned growth.”
T-Mobile Making Savvy Un-Carrier 9.0 Moves, Say Analysts
Avi Greengart, research director for consumer platforms and devices at Current Analysis, told eWEEK at the T-Mobile announcement in New York that the moves are good ones for the company to be pursuing. “They’re aiming it at the part of the market where they have the biggest opportunities,” said Greengart. “Small businesses are likely to be the most price-sensitive. They are likely to be the most receptive to policies designed for easy interaction. And it’s an area where Verizon and AT&T have existing advantages.”
For large enterprises, they may not be seeking the lowest prices for mobile services, but are looking for extra flexibility and logistics services that could be available through larger carriers like Verizon and AT&T, said Greengart. “But with small and medium businesses, T-Mobile has identified real pain points” that they can use to try to capture new business customers. “And as their network improves in its rural coverage, they’ll have a better story to share.”
Greengart said that he agrees with Legere’s recent comments that T-Mobile’s network has vastly improved and been expanded in recent years. “Looking back over the last two years, the network improvement at T-Mobile has been extraordinary,” said Greengart.
Susan Welsh de Grimaldo, a global wireless analyst with Strategy Analytics, told eWEEK that T-Mobile is finally ready to do more in the small and midsize business marketplace because the company now has its network more developed so that it can better serve such customers.
“You’ve got to get your network right,” she said. “They’ve always had a big consumer business, and they had to get that right to expand.”
The new T-Mobile consumer offerings are also interesting, she said. The device payment pay-offs for new customers “target a specific set of consumers—notably new iPhone 6 purchasers who may have switched carriers or upgraded with an [installment plan] on an existing carrier but who want to try out T-Mobile,” she said. “Sometimes people have not switched carriers [simply] because of inertia, or they are happy and have not seen a major reason to move. This particular offer is more targeted to unhappy customers, but it doesn’t really compel people who are relatively happy with their current provider to consider switching.”