How T-Mobile wanted to change itself but ended up changing the wireless industry
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T-Mobile: http://www.t-mobile.com/optional-services/roaming.html (Free texting, free 2G data in 140 countries, calls 20 cents per minute, 3G data available for a fee; covers every continent except Antartica.)
Sprint: http://www.sprint.com/landings/international-value-roaming/ (Gets closest; free roaming in 64 countries and similar price plan, but there are significant gaps: it does not cover most of Europe or Asia, and Africa and the Middle East are notable dead zones)
Verizon: http://www.verizonwireless.com/landingpages/international-tr... ($10 day passes, $25 monthly plan that does not include free texting, calls $1.79 a minute, only 100 megs of data)
AT&T: https://www.att.com/shop/wireless/international/roaming.html (Cheapest plan $30, only includes 120 megs of data, calls still $1 per minute)
The company took its biggest advantage over every other U.S. carrier—its affiliation with a large international mobile conglomerate—and leveraged that into something no other carrier could pull off to the same level of coverage. A brilliant move on their part.
I now make a point of recommending people switch to T-Mobile before making a big international trip.
This is how it went.
They had one of those 'not really a discount' price structures going on. i.e., say the normal market price of a service is $100 a month, they'll price it at $400 per month and then say you get a 75% discount. You still pay normal market price.
The contract was for 2 years. After 2 years you can call 'm up and cancel, or renew at a new price. If you don't do anything, they won't cut your service (which makes sense, that'd leave a lot of customers surprised 2 years in), but they'll 'silently renew' the contract every month indefinitely, until you cancel. So you're not actually tied into anything after those 2 years.
But the shitty thing is this... after 2 years, the 'discount' price ends, and you end up paying the $400 rate.
Not just that, but the original $100 'discount' rate (the normal market rate at the time, btw), was for connectivity + a phone, because I got a free iPhone included. Obviously it's not free, it was just priced into the $100 contract.
Plus, after 2 years the market rate of the connectivity + phone dropped from $100 to $50, the connectivity itself cost only something like $30.
So instead of paying $30, I was paying $400. I was never called up or something to discuss my options, they simply executed a silent agreement we made in 2013 in tiny letters.
I made up the numbers btw, they're not as shocking but in the past 7 months I ended up paying $250 more than I should have. Legally what they did was fine, but it was really shitty and felt like a 'gotcha'. I appreciate I should keep track of when my contracts end and check my fees, but when a company exploits this, they're no longer in the business of profiting off offering me a service I want, but they're in the process of unduly extracting surplus cash for non-service above their own market rates. That's 'gotcha' fees if you ask me.
Other than that, I'm really happy with T-Mobile, solid company that I've always been quite happy with. I've contacted them about the above to see if they want to meet me halfway and credit me a substantial fraction of these bs extra gotcha fees. If not I'll likely switch to a competitor, hope I won't have to.
While it would be nice I just don't expect them to go out of their way to get people to switch because it's a lot of effort to orchestrate for minimal gains.
It would be great to see a good faith "hey you would save $ by switching to our new plan" from t mobile I can't help but think they don't because people hate dealing with phone companies, even if they're trying to do good stuff.
Most people don't want to be sold a new "better" plan, even if T-Mobile said it was cheaper. A lot of people would ignore it just like they ignore any sales pitch, such as a new Comcast deals they get calls/emails about. No one wants to switch plans and exert that effort unless they have to. If they want to save money they'll be the ones initiating the change. At least that's how I'd think about it.
But seriously, call t mobile and ask if there's anything hey can do, maybe they'll give you a short term deal to make up for the extra you had been paying. They've been awesome in dealing with these types of problems when I've talked to them. They're more interested in customer loyalty And happiness than a little extra $$ at this point.
If you really don't think this is gotcha pricing, I'll repeat once more... after two years I paid off my phone (i.e., I'm not paying for it anymore, so my monthly fees go down). Instead of reducing my fees by switching me to one of their normal plans (which would cut my fees by 50%), they switched my contract and hiked my fees by 50%.
For a sense of the extra fees they were charging silently for 7 months, here's two example comparisons:
1) They have a plan (to which I switched today), that's 3x cheaper than what they had me pay, but that doubles my monthly data cap and keeps my monthly minutes exactly the same. They were overcharging 3x for less service.
2) I currently get a certain data cap + minutes on a no-phone contract. They have an offer for a free iPhone 5S (1y old model) with 50% more minutes and 5x the data cap, that's about 30% cheaper than what they had me pay. I pay more than the plan that gives me way more service + a free phone that's worth hundreds of dollars. Oh and I'd get 4G instead of 3G, too.
Again, they silently hiked these fees, at a point that they could either 1) switch me to a normal-rate product (that I switched to today), or 2) send me a freaking email or text message about the fee hike at the very least. It's a shitty move.
It's really shitty because I feel I need to switch to stay true to my ideals. At the same time, I can't think of a less shittier company, I really like T-Mobile and expect every major telco to have pulled this trick except them. Anyway I reduced my fees by 2/3rds today with a simple call for now, will think about what to do after.
That's not quite true. They did switch me on a new contract automatically when my 2 year contract ended. And that new contract was priced 3x the normal rate, and it's a 1-month contract they renew every month until I cancel.
So it's not 'a lot of effort', they did switch my contract, but instead of switching to a normal one they switched me to a 3x overpriced one at a rate they don't actually offer to customers on their website.
As for the gains, well that's the whole point of my post, the gains on me were huge: they're making money by silently switching me to a ridiculously overpriced contract on the basis of a tiny-letter clause in a contract of a few years back. About a third of the money they extracted from me so far is for non-service, money they'd only make when the customer is lazy/ignorant enough to not spot the exploitation. That's the definition of 'gotcha pricing', isn't it?
As for the switching part... That's true for 2 year contracts. I hate being called up for that, because I'm just locking myself in to another 2 years. I'd rather sit this one out, and then get a great deal myself on the next one. But in this case it didn't apply because they renewed me for an indefinite 1-month contract at 3x their own market rate, they could've just as easily either 1) automatically and silently renewed at their NORMAL prices they actually charge in their shop for a 1 month contract, I wouldn't even be involved in that and it'd be a fair deal or 2) at least call me or email (didn't receive even a text to my phone) to inform me they RAISED my fees even though they reduced their offering to me! without necessarily pitching any new contract, merely informing me would've been nice.
I mean, to give you a sense of the deal they got me on silently (without a single notification) vs the normal market rates in their store right now: They have an offer in their store that costs 30% less than what I pay now. That offer gives me 50% more minutes and 400% more megabytes than what I have right now, on a 4G connection instead of 3G right now, with a free 1 year old model of an iPhone (5S) included, vs no phone part of the contract I have right now.
And they never even informed me of this bs, it's textbook gotcha pricing. I'm not saying T-Mobile is a crappy company, just that in my anecdotal case, they screwed over a customer with a shitty clause in their contract to take advantage of the fact customers tend not to review a services' fees a few years into a contract. There are fair and practical alternatives to that, but they chose gotcha pricing instead. I don't think you can see it any other way.
> But seriously, call t mobile and ask if there's anything hey can do
Yeah as I said already contacted them, they're getting back to me.
There is a comment below from a former employee on this, but really you don't even need to have worked there to know that they outsourced all of IT systems. Literally every single thing that could be broken is broken, e.g.
- If the sales reps leave a note in your account, the tech support teams can't see that because they're on different computer systems. And the in-store computer systems are completely different than the ones that phone support uses, so same issue.
- Want to merge two accounts into a family plan? They tell you can do that, but what they don't tell you is that you can't do that if you bought a phone from them. (WTF?)
- Similarly, if got one of those cell extenders for your house and then you move, you need to mail it back to them rather than changing the address.
- Phone support will tell you to go into their stores to take care of certain issues, but then the folks in the stores will tell you that they can't do it for whatever reason.
I've actually just started recording all my calls with them. The incompetence is truly stunning. Even at their worst, AT&T and Verizon were never even close to this bad.
This varies tremendously by area. Have you seen a source that shows this to be true overall, or is this just in your area?
IME as a happy T-Mobile user, T-Mobile is great in urban areas, but weak in suburban and rural areas--where most Americans live. It's only anecdotal, but it lines up with the anecdotes of other T-Mobile users I know.
RootMetrics shows them improving coverage significantly, especially in the last 18 months.
In my area (entirely suburban + rural Michigan), they've more than doubled their native coverage footprint.
http://i.imgur.com/SG8ePYe.gif for a nationwide overview of the improvements.
If you look at their coverage map, they're lighting up 600 - 700 mhz spectrum all over the country. This is only within the last year though, and it only works if you have a phone that can take advantage of it. E.g. the iPhone 6s is the only iPhone that works with the new t-mobile spectrum. So yeah historically you're right, but I think that has changed within the last six months. And similarly it's going to change even more this spring after the next round of spectrum auctions.
I'd be happy if T-Mobile just bought US Cellular to make them go away.
The best site for spectrum maps that I know of is this:
Overall, the service/connectivity is great as well in the US. They were also the first with wifi calling. Highly recommend to anyone.
Let’s hope that soon every carrier provides this.
I seemed to be on 3.5G networks but it said it was throttled to 128kbps. The fees for unthrottled data were kind of obscene, though - $50 for a '30 day' pass including only 500MB of unthrottled data.
The climate was toxic. IT was just a cost center. We had multi year waterfall death march projects.
I eventually resigned after most of the work was pushed to offshore contractors, the onshore teams gutted, and those that remain responsible for rewriting the crap the offshore teams produced.
I ran into a old friend who is still there recently, and I was surprised to find out that despite the huge public changes under Legere, IT was still a huge mess with the same leaders pushing most of the work offshore.
There is good engineering in telecom, inside the switches, which are purchased from outside vendors.
This 'organization' has no customer service line, and the existing cell-phone companies essentially work as oligopolistic - and profitable - vassals of the polygon.
I think that the company's comeback has largely been driven by innovative marketing and smart business offerings, rather than the technology itself.
I went to Verizon and got more data for less money, and since I had an Iphone 6 it was fully portable to Verizon.
I'm surprised it took this long.
In Germany it is the other way around: T-Mobile recently lost the leading position to Telefonica from Spain, which is called O2 in Germany, after several mergers.
After purchasing TMUS DT neglected to invest in them for capital improvements (spectrum purchases and equipment upgrades) and they fell further and further behind the competition (at its worst they were 4th out of 4 with 33 million customers[1] to #3 Sprint's 55 million[2] and #1 Verizon's 92 million[3]) until DT tried to dump TMUS in 2011 by selling it off to AT&T. The only reason T-Mobile US is competitive today is because the FCC blocked the merger and AT&T had to pay a substantial "break-up fee" in the form of $3 billion in cash and $1 billion in wireless spectrum (which is worth substantially more today).
[1]http://www.tmonews.com/2012/02/t-mobile-announces-fourth-qua... [2]http://newsroom.sprint.com/news-releases/sprint-nextel-repor... [3] https://www.verizon.com/about/news/press-releases/verizon-re...
Could we borrow John Legere for a bit here in the UK?
I'd love to get rid of the landline, but I need it for a couple of gigs worth of data a month. Believe it or not, it is cheaper to pay line rental to BT and £10 a month to EE than to get that from a mobile supplier using a mifi.
t-mobile is usually the better value but doesn't have the towers and signal strength
mvnos are changing the value part though, you can get verizon's towers and signal strength without paying verizon prices, it's just the average consumer has no clue
I wasn't aware of any Verizon MVNOs though, it seemed like they all went away or got bought up. Mind sharing which are available?
http://blog.nqzero.com/2015/12/at-mvno-pay-as-you-go-data-pl...
However service in rural areas and along the interstate system was awful. I was either roaming on 1X or without service entirely for very nearly the entire stretch of Cheyenne to Tahoe.
I had to switch, but I think it's the right strategy for the capital-limited underdog. You only need a few towers to cover a city compared to the Great Plains or the interstates, and many people spend nearly all their time in town.
As I understand it, Verizon has historically had the strongest presence in the low frequency range, which is part of their reputation for the strongest network. Fewer towers can cover more ground more effectively at lower frequencies.
Yes this is correct, and the reason they have this 'monopoly' on the low frequency range is because Verizon has been the most shrewd at getting the government to grant them licenses for this spectrum.
I guess the price point on good enough smart phones is also at least headed below $300 (for me it's less than $200, but people like shiny things).
I get that. Still it has nearly as much employees as Verizon and AT&T combined. Telekom is one of the least start-up-like organization you can think of. Some of these employees still have the status of German Beamte and are unfireable. I do not know if you are familiar with German bureaucracy, but Kafka wrote some books about it …
Nevertheless articles like this treat T-Mobile like it's a small fast-moving start-up battling against evil corporations.
Egregious editing for a news organization.