T-Mobile Challenges Verizon, AT&T, Sprint to ‘Abolish’ Overage Fees

T-Mobile’s third major announcement, as part of a trio of “Un-carrier moves,” is that it’s abolishing overage fees.

T-Mobile years ago moved away from charging customers for using more data than their service plan allowed, relying instead on “throttling,” the practice of transitioning users to a slower network. Now it says all customers, even those on old contracts from its pre-throttling days, won’t pay a dime more than their expected bills.

But the real kicker is that it’s calling on AT&T, Verizon Wireless and Sprint to follow its lead.

T-Mobile CEO John Legere started a petition titled #AbolishOverages on Change.org, “laying down the challenge” to T-Mobile’s Tier-1 peers.

According to Legere, last year more than 20 million Americans paid overage fees totaling more than $1 billion to AT&T, Verizon and Sprint.

“It’s time to show these companies that we’re not going to take these outrageous fees lying down anymore,” Legere says in the petition.

“Traditional wireless plans start with a low monthly fee for a fixed amount of domestic minutes, texts or data,” he continued. “Once customers go over those limits—even by a little—they’re hit with dramatically higher rates and extreme penalties. These plans seem purpose-built to drive customers over that invisible line into massive overage charges. This is plain wrong, and it must end.”

In a blog post on the T-Mobile site, Legere added that he’ll take personal pleasure in watching his competitors feel the weight of the demand.

“Imagine the smile on my face as I watch millions upon millions of Americans flipping the bird to the insanity and pain of the past and joining this consumer revolution—while I sit back and watch the competition flounder,” he wrote.

On April 9, T-Mobile kicked off its three days of news with the introduction of a Simple Starter plan: a single line of service with 500MB of 4G LTE data and unlimited talking and texting for $40 a month.

On April 10, T-Mobile focused on tablets, selling 4G LTE-enabled models at the prices of their WiFi-only counterparts; enabling subscribers to add a tablet to a service plan at no additional cost; and offering 1GB of free monthly data every month through the end of the year. (In October, it offered 200MB of free data a month for life. So, through 2014, there’s the opportunity for 1.2GB of free monthly data on T-Mobile’s LTE network.)

In his April 14 blog post, T-Mobile said that the reaction to last week’s announcements—as well as the launches of two new major devices, the Samsung Galaxy S5 and the HTC One M8—has been “fantastic” and “unbelievable.”

“But the best is yet to come,” he added. “Tens of millions of American wireless consumers are going to be enjoying the benefits and freedoms that come with these latest Un-carrier moves in the weeks and months ahead.”

He also insisted that there’s a movement under way.

“Whatever first sparked the change becomes just one part of a larger movement. The people own it. … When I give you our first quarter 2014 progress update on May 1, I think you’ll see what I mean.”