T-Mobile started something that we had never seen before in the wireless industry. Which was an effort to eliminate customer pain points, which they branded as being the “Un-carrier“. The reasoning behind the Un-carrier, according to CEO John Legere, was to fix a “stupid, broken, and arrogant” industry. In March 2013, T-Mobile started with a bang. Getting rid of contracts, although they weren’t actually getting rid of them. What they were doing was separating the cost of your smartphone from your bill, and having you pay off your phone each month, like you would a car. If you decided you wanted to leave T-Mobile, the cost of your phone would become due – sort of like a contract. This was a good thing for those that did buy their phones unlocked, or at full retail, as their bills would be cheaper each month, instead of paying for a subsidy on a phone they didn’t buy. Under T-Mobile’s (and other carriers) old plans, that was not the case.
Since the very first Un-carrier move, T-Mobile has unleashed a bunch of others, which have mostly helped eliminate customer pain points. Including the ability to upgrade sooner with JUMP and JUMP On Demand, instead of having to wait two or more years. The ability to stream music and video without it counting against your data cap. Other moves included Data Stash – allowing you to store your unused data – as well as Simple Global, which gives you the ability to roam in over 140 countries without incurring roaming fees. All of these were great Un-carrier initiatives and definitely helped to solve customer pain points. But with Un-carrier 11 which was unveiled in early June, T-Mobile is giving away free things with the ‘T-Mobile Tuesdays’ app, which seems to be having issues every week. Making it appear that T-Mobile has run out of ideas for their Un-carrier moves. And Un-carrier 11 seems to be just a big gimmick for T-Mobile to gain more customers.
While yes it is cool to get free pizza every Tuesday, or a free ride on Lyft, or even a free Frosty from Wendy’s, it’s not really something that was a pain point for customers. T-Mobile Tuesdays have been going for almost a month now, and each and every week, the company has had problems with the app. And a few weeks ago, Domino’s ran out of pizzas, leading them to pull out of their partnership with T-Mobile (which was supposed to last through the end of June). Which shows that T-Mobile Tuesdays is just one big headache for customers as well as T-Mobile. Something that could have been avoided too, which makes the case even worse for T-Mobile.
This leaves us wondering, what can T-Mobile do next? Well there are still some customer pain points out there that could be solved. Of course, the big one is their network. Now, T-Mobile is working on their network, and anyone that has been using T-Mobile for the past few years will definitely know that is the case, but there’s still a ways to go. Another pain point would be offering unlimited data to everyone. Where T-Mobile already doesn’t count music and video towards your cap – the two biggest data hogs – it would seem that T-Mobile is giving everyone unlimited data (we’re talking high-speed, not throttled 2G speeds). When it comes to traveling, another pain point that could be eliminated is being stuck on slow 2G speeds in many countries. T-Mobile has already changed that to 4G LTE in Mexico and Canada (Europe for the Summer), so we may see this work for the other countries included in Simple Global. Otherwise, there’s not much that T-Mobile can do, other than giving their customers free service. And as a publicly traded company, that wouldn’t be a good idea.
With some of these Un-carrier moves, we’ve seen T-Mobile’s competitors implement some of them to compete with the Un-carrier. Although this has mostly been in terms of getting rid of contracts and doing early upgrades. The real question here is whether other carriers will turn to these gimmicks as well? Probably not. Unless these gimmicks really help T-Mobile gain a boatload of new subscribers – which it has so far, adding over 1 million customers in 12 straight quarters (or three years) – Verizon, Sprint and AT&T likely won’t turn to gimmicks like this to bring in customers and revenue.
Gimmicks like ‘T-Mobile Tuesdays’ have worked for some companies – even outside of the wireless industry – but they don’t net long term benefits for many companies. Which is something that is going to hurt T-Mobile in the long-run. While we’ve had 11 Un-carrier announcements already, it’ll be interesting to see if we get another one, especially after how bad both Un-carrier 10 and Un-carrier 11 have been, in the press. Un-carrier 10 was for Binge On, where T-Mobile would downgrade the quality of your video and it wouldn’t count against your data cap. Many claimed that it was a net neutrality issue, seeing as only some video services were included in Binge On and not all. But they have since worked that out, and made the FCC, customers and video services happy with Binge On. Now with T-Mobile Tuesdays, it looks like T-Mobile is having an even bigger issue. It’ll likely be worked out over time, but it is a bit surprising to see that the company didn’t expect to have this much trouble with their app, especially since it’s happening each and every week.
The Un-carrier movement has turned T-Mobile from a company that was losing about a million subscribers per quarter, to now adding that many each and every quarter. It has helped the company create a pretty big turnaround, pretty quickly. Of course, the majority of that is due to Deutsche Telekom – T-Mobile’s parent company – installing John Legere as T-Mobile USA’s CEO in 2012, and then purchasing MetroPCS. T-Mobile has jumped from being well into fourth place in the US, to now being far above Sprint for the third largest carrier in the US. Still quite a ways behind Verizon and AT&T, but they are holding their own. T-Mobile has made such a huge turnaround that Deutsche Telekom isn’t shopping T-Mobile around to sell them, like they were in the early 2010s. In fact, part of T-Mobile’s turnaround could be attributed to AT&T’s failed buyout of T-Mobile. When the deal fell through, T-Mobile picked up a big chunk of spectrum from AT&T, as well as gaining $3 billion in cash. While that wasn’t the biggest reason for this turnaround, it definitely helped.
T-Mobile has single-handedly changed the way the wireless industry works in the US. In fact, customers on every carrier have seen their bills drop over the past 3-4 years, even on AT&T and Verizon, which are notoriously the highest in the country. Not to mention the fact that users are actually able to upgrade their phone sooner than once every two years, without having to pay an arm and a leg for a new smartphone – especially since most flagships are around $500-700 each. This is all due to their Un-carrier approach, but the Un-carrier approach may be about over. As there’s not much left for T-Mobile to do, without taking money out of their shareholders pockets. And that’s not something that would keep them in business for long.