T-Mobile on Wednesday finally took the wraps off its Uncarrier 4.0 initiative and as expected the company will offer to pay off early termination fees for families that are switching over from other carriers. T-Mobile also says that with “an eligible phone trade-in, the total value of the offer to switch to T-Mobile could be as high as $650 per line,” which is actually $200 higher than AT&T’s comparable offer.
By paying off customers’ early termination fees, T-Mobile is trying to drive a stake into the heart of the two-year service agreements that the company scrapped last year as part of its first “uncarrier” initiative. Other major moves that T-Mobile made last year included giving customers the option of upgrading their smartphones earlier and to offering free international data roaming. AT&T earlier this week preempted T-Mobile’s strike by announcing that it would give an additional $200 to any subscriber who switched from T-Mobile in addition to as much as $250 for trading in their old smartphones.
T-Mobile’s press release follows below.
T-Mobile Delivers Contract Freedom for Families By Paying Off Early Termination Fees
Company marks 1st anniversary of Un-carrier revolution by offering to reimburse entire amount of customers’ early termination fees when they switch from AT&T, Sprint or Verizon
LAS VEGAS — Jan. 8, 2014 — One year ago at International CES, T-Mobile US, Inc. (NYSE: TMUS) threw down the gauntlet, promising relief for customers fed up with a broken, arrogant wireless industry. Since then, the company has delivered on its promise with a relentless barrage of Un-carrier industry innovations.
In its latest move, T-Mobile is eliminating one of the last remaining obstacles for individuals and families wanting to switch from AT&T, Sprint or Verizon to the Un-carrier by offering to pay off their early termination fees. With an eligible phone trade-in, the total value of the offer to switch to T-Mobile could be as high as $650 per line.
“We’re giving families a ‘Get Out of Jail Free Card,’ said John Legere, president and chief executive officer of T-Mobile. “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.”
Customers have been flocking to T-Mobile for its no annual service contract Simple Choice Plan, industry-leading JUMP!™ upgrade program, unlimited global data at no extra charge in 100-plus countries, and most recently for Free Data for Life on every tablet — up to 200 MB of free 4G LTE data every month for as long as they own their tablet and use the registered device with T-Mobile. But Nielsen research suggests up to 40 percent[i] of families hold back from switching because of high early termination fees (ETFs), and a recent online poll conducted by GigaOM suggests that 78 percent[ii]would switch to T-Mobile if their ETF was paid. ETFs can cost as much as $350 per line. Multiply that two, three or four times for a family, and switching becomes an extremely expensive proposition.
“Carriers like to make you think you’re just signing up for two years with their family plans, but with staggered expiration dates and early termination fees, they’re really locking you in forever,” said Mike Sievert, chief marketing officer for T-Mobile. “Now, families are free to switch without worrying about early termination fees. And by switching to T-Mobile, a family of four can save $1,880 over two years compared to an AT&T shared family plan[iii].”
Here’s how T-Mobile’s offer to pay off these fees works:
Starting tomorrow, customers from the three major national carriers who hand in their eligible devices at any participating T-Mobile location and switch to a postpaid Simple Choice Plan can receive an instant credit, based on the value of their phone, of up to $300. They then purchase any eligible device, including T-Mobile’s most popular smartphones, now priced at $0 down (plus 24 monthly device payments, for well-qualified customers). After customers get the final bill from their old carrier (showing their early termination fees), they either mail it to T-Mobile or upload it towww.switch2tmobile.com. T-Mobile then sends an additional payment equal to those fees, up to $350 per line. Trade-in of their old phone, purchase of a new T-Mobile phone and porting of their phone number to T-Mobile are required to qualify.
This offer to pay early termination fees provides families with a quick way to escape carrier contracts that have deterred them from pursuing a better and more affordable wireless experience with T-Mobile.
T-Mobile is also making it easier for its longtime customers to migrate to Simple Choice plans as well without incurring any migration fees. To qualify for this option a current customer under contract trades in their current device and purchases a new T-Mobile device and switches to Simple Choice. In addition to waiving the migration fee, T-Mobile will also eliminate the existing annual service contract for that customer’s line.
With a Simple Choice Plan from T-Mobile, families start with one line at $50 per month for unlimited talk, text and Web with up to 500 MB of 4G LTE data. They can add a second phone line for $30 per month, and each additional line is just $10 per month. In short, a family could get four lines for just $100 per month (plus taxes and fees). The potential savings are so significant that if every single AT&T, Sprint and Verizon customer switched to a Simple Choice Plan, T-Mobile estimates they would save up to $20 billion [iv]collectively each year.
In addition to great family plan savings, individuals and families can also enjoy an incredible wireless experience thanks to T-Mobile’s rapidly expanding nationwide 4G LTE network– now the fastest[v]in the United States. For more information, visit the T-Mobile newsroom.