T-Mobile Announces "Uncarrier 4.0" to Cover Switchers' Early Termination Fees
The rumored Uncarrier 4.0 announcement that sparked a preemptive strike from AT&T this week is now official: T-Mobile will pay early termination fees for customers on contract with other wireless companies that want to switch.
The announcement was made by T-Mobile CEO and recent AT&T party outcast John Legere at the Consumer Electronics Show in Las Vegas on Wednesday.
Legere, who has made no attempt to hide his contempt for AT&T in particular, presented T-Mobile's incentive that covers early termination fees as the "Get Out of Jail Free Card."
The initiative covers AT&T, Sprint, and Verizon, and allows customers who want to switch from one of those major carriers to T-Mobile to end their contracts without personally paying for it. T-Mobile will pay up to $350 in early termination fees, and give up to $300 in new device credit, meaning the company is offering up to $650 for switching per line -- for up to five lines.
"We're giving families a 'Get Out of Jail Free Card,' said T-Mobile's president and CEO John Legere at CES 2014. "Carriers have counted on staggered contract end dates and hefty early termination fees to keep people bound to them forever. But now families can switch to T-Mobile without paying a single red cent to leave them behind."
The move is not only aimed at gaining subscribers, but stealing them away from the other big three wireless companies in family-sized units: T-Mobile claimed that a family of four, for example, could save $1,880 in two years over other carriers with T-Mobile's rates. Already, with the company's aggressive "Uncarrier" strategy in 2013, T-Mobile added more customers than every other carrier combined in Q4, according to Legere's CES announcement, with a total of 4.4 million customers added by the year's end.
So how does one take advantage of the "Get Out of Jail Free" card? After customers switch their line to T-Mobile, trade in their old phone, and buy a new T-Mobile phone, they can send the early termination bill to T-Mobile, and the company will refund $350 of the fees. Customers must buy a new T-Mobile phone in order to get the termination fee money and the new device credit. This works for up to five lines and devices.
In the build-up to CES 2014, T-Mobile was rumored to offer something like this early termination fee-covering incentive, though the exact amount of money offered for each line and device was not known.
AT&T, who on Saturday announced that it would offer up to $450 per line when they switch to AT&T, apparently took the rumors seriously. The difference between the two switching incentives was that AT&T's offer was targeted directly at T-Mobile customers. At the time, Legere responded to the direct AT&T attack by calling it a "desperate move," and saying, "I'm flattered that we have made them so uncomfortable! We used AT&T's cash to build a far superior network and added Un-carrier moves to take tons of their customers -- and now they want to bribe them back!"
T-Mobile, which is still the fourth most popular wireless carrier in the U.S. also announced at CES that it would begin implementing Wideband LTE service in select markets, staring in Dallas, in order to enhance its network's speed and reliability. The company also promised to improve coverage in rural areas and suburbs, where its coverage has been the weakest.
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