T-Mobile Rips Up Final Contract, Offering to Pay Switchers' ETFs

T-Mobile's latest "un-carrier" move is to pay potentially as much as $650 for each line that's switched over from any major carrier.

T-Mobile, as expected, announced it will pay individuals and families to switch from AT&T, Verizon or Sprint to its network.

"It's not a promotion; it's not a switching gimmick. It's the end of contracts," said Chief Marketing Officer Mike Sievert during a Jan. 8 press event at the International Consumer Electronics Show (CES).

Starting Jan. 9, T-Mobile will pay up to $350 per line in early-termination fees (ETFs).

"With an eligible phone trade-in, the total value of the offer to switch to T-Mobile could be as high as $650 per line," T-Mobile said in a statement. It will pay the fees for up to a family of four.

T-Mobile will pay up $300 to anyone who trades in an eligible phone and switches to a postpaid Simple Choice plan. After she receives her last bill from her old carrier, she can mail it to T-Mobile or upload it to www.switch2tmobile.com and T-Mobile will pay off the bill, up to $350 per line.

CEO John Legere laughed off the idea that AT&T's Jan. 3 offer—to, for a limited time, pay up to $450 per line to T-Mobile customers who switch to AT&T and trade in an eligible smartphone—wasn't in response to T-Mobile's planned announcement.

"AT&T is a total source of amusement … they take the bait every time," said Legere, imitating AT&T leadership's efforts to position the offer as simply something good for customers. "Why don't you have the [guts] to answer the question?"

Legere later threw out figures, stating how much more a family of four would pay on AT&T, for a limited amount of data, than on T-Mobile with unlimited data (though not all of it at 4G speeds).

"My suggestion is that everyone take our plan. If it doesn't work, then take AT&T's plan!" said Legere, fired up by likely a mix of enthusiasm and the Red Bull he brought on stage with him.

"If our plan doesn't work for you, they'll pay you to come back. AT&T has given us almost a no-fault guarantee. These [guys] will pay you to come back!" Legere continued, clearly delighted by the idea of his rivals essentially tangled in a trap they'd set for him.

During the press event, T-Mobile's leadership applauded Verizon's frankness about some of its weakness, panned AT&T relentlessly as being lame and ridiculous, and dismissed Sprint as being (put more kindly for print) lost in its endless construction dust.