T-Mobile Un-carries On

By Stephanie Blanchard, Contributing Writer — June 19, 2014

Who cares about just making money? T-Mobile wants to change the industry—it’s the underlying motive behind each “Uncarrier” move, said its charismatic CEO John Legere. Standing before a rowdy crowd at the Paramount Theatre in Seattle on Wednesday, June 18, Legere let loose his trademark style—expletives and jabs at the other Tier 1 wireless players—as he announced Uncarrier 5.0.

“I promised myself I would not get angry,” he said, before riling himself up over the amount of money carriers annually spend on media advertising—$6 billion dollars. The industry, he said, wants potential customers to be confused, resulting in a higher remorse rate than the used car business.

In contrast, T-Mobile wants to keep things simple. Just like a driver would not take a vehicle off the lot without a test drive, a smartphone user can now try out the iPhone 5s for seven days. (Business customers may have an extension of two weeks.) Designed to get rid of the pain point “buying blind,” Uncarrier 5.0 allows users to “cheat” on their carriers, even T-Mobile.

Although a credit card is required to sign up, Legere insists customers will not be charged during the trial period. Simply place an order through the website, try out the device during the allotted time period and drop it off at a T-Mobile store if not interested in keeping it.

Partnering with Apple, T-Mobile is anticipating to do one million Test Drives, and is prepared for more if needed. Legere noted that this is a win-win for both companies, as many users are unaware that T-Mobile even carries Apple products.

Back in early 2013, T-Mobile decided to jolt the industry with its Uncarrier 1.0, which eliminated two-year contracts. Uncarrier 2.0 launched Jump – the ability to easily upgrade smartphones as they debut. Both initiatives caused quiet grumblings among peers but the fourth place Tier 1 carrier was still considered just that.

Uncarrier 3.0, however, really sent a shockwave in the fall of 2013, by offering unlimited data plans and international roaming rates. Now that was considered crazy. But it was a risk that paid off as subscribers poured in.

At the 2014 CES show in Vegas, T-Mobile unveiled Uncarrier 4.0 which eats the cost of early termination fees for users wanting to switch from other carriers. Not surprisingly, Legere was thrown out of a competitor’s party that week as well.

In addition to test driving iPhones, Uncarrier 5.0 also introduces a new music Internet service, unRadio, powered by Rhapsody. Free to unlimited customers, a small monthly surcharge for others, the service allows users to customize music content without advertising.

Data Points
A cell phone is not just a dial tone. Today’s smartphones are supercomputers, and, as such, T-Mobile does not see itself as a wireless carrier but a mobile Internet company, where data is king. The carrier currently has Wideband LTE in 16 markets (a 90-minute HD video can be downloaded in three minutes) and 100 million users have VoLTE (Voice over LTE), due to be nationwide by year end.

And when it comes to data, T-Mobile customers use anywhere from 61% to 100% more than those with other carriers, according to the company. Millennials are especially data centric. “Why are data users treated as second class citizens?” Legere asked, referring to competitors. ”Why don’t competitors offer unlimited data plans?” Is it because they can’t? Greedy? Or Both? he wondered.

In response to its other Uncarrier moves however, competitors have altered their games plans, and Legere is pleased. It benefits the user, he said, adding a few curses for emphasis.

But what about the enterprise, Mobile Enterprise asked Legere at the Seattle event. What’s the impact on business users? After all, 17 million subscribers signed up from the initial Uncarrier announcement in 2013 through today. The focus is not the large corporate customers, the “UnCEO” replied. The carrier is going after the small business owner, who by nature, demands flexibility.

Likewise, Uncarrier initiatives will not end with 5.0. “We will not stop,” Legere insisted. Even with constant rumors of a Sprint merger, T-Mobile is always looking three to five years ahead with multiple paths forward.


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