Business

Actions

Newest Mobile Fight? T-Mobile Offers To Pay Termination Fees

In the latest gauntlet thrown down by a major mobile carrier, T-Mobile says it'll give you up to $650 to switch providers.
Posted at 11:04 AM, Jan 09, 2014

This is getting good — at least, if you're the consumer. Less than a week after AT&T offered customers $450 to switch over from T-Mobile, T-Mobile fired back.

"T-Mobile says it will pay early termination fees for those who switch from other providers. Customers can receive up to $650 in credit after trading in a phone and buying a new one." (Via WCBS)

While $650 is a nice, big number, the offer breaks down to a max of $350 per line and $300 per phone based on its market value as a used device. (Via T-Mobile)

T-Mobile made the announcement at the Consumer Electronics Show in Vegas. The No. 4 carrier in the U.S. hopes to chip away at market share with the latest strategy challenging what many view as one of the most prohibitive reasons to switch.

"We asked the question why not go to T-Mobile? And the answer was early termination fees ... When I attack somebody, I make it very clear. We're going after everybody's customers." (Via CNN)

The attacks have been flying recently between AT&T and T-Mobile — both companies showing some not-so-veiled animosity after a failed merger in 2011.

When AT&T announced its $450 plan, T-Mobile put out a press release calling it desperate. (Via T-Mobile)

And when a CNET executive editor posted this picture to Twitter of Legere crashing an AT&T party at CES, the company promptly kicked him out. (Via Twitter / @RogerWCheng)

But will T-Mobile's stated intention of ridding the cell phone world of contracts work? Forbes says No. 1 provider Verizon and No. 2 AT&T control about two-thirds of the market share, so any significant shift would be undeniably tough.

Still, The New York Times suggests the three biggest mobile competitors, which includes No. 3 Sprint, are now in "somewhat of a defensive crouch."

Telecom analyst Jan Dawson told the Times, "It's a pretty low-risk thing to do — switch to T-Mobile, get a bunch of money for your devices, and then switch back if you don't like it. It's a smart move and one that will likely perpetuate T-Mobile's momentum for another few months."

So from a customer's standpoint, let the fight continue. Competition for our dollars means we might not have to spend as many of them.