AT&T plans to offer a credit to T-Mobile customers who switch to AT&T — jabbing at its smaller rival and attempting to get out ahead of T-Mobile’s rumored plans to do the same thing to AT&T and other wireless carriers at a news conference scheduled for next week in Las Vegas.
[Update, Friday morning: AT&T confirms $200 ‘switcher credit’ for T-Mobile customers]
GeekWire learned this information from a knowledgeable source today. We’ve contacted both companies for comment. The credit from AT&T is expected to be as much as $200, and from what we’re hearing, it’s not expected to be offered to Sprint or Verizon customers. The credit would be in addition to up to $250 of the trade-in value of the switcher’s old device, under AT&T’s existing trade-in program.
The move by AT&T would appear to be a pre-emptive strike. The independent TmoNews site, citing two separate tips, reported Dec. 20 that T-Mobile may offer a rebate valued at up to $350 to customers who switch from competing carriers, to cover the cost of their early termination fees. Part of the rebate would come from the trade-in value of their devices.
AT&T’s plan is the latest sign of the escalating rivalry between the companies, which at one point were on a path to merge their operations, before U.S. regulators nixed AT&T’s proposed acquisition of T-Mobile. Among other things, AT&T’s move would illustrate just how much of a thorn in its side T-Mobile has become under the leadership of CEO John Legere, who frequently jabs at the larger rival, as in this tweet and picture.
— John Legere (@JohnLegere) January 2, 2014
Bellevue-based T-Mobile last year moved away from traditional phone subsidies for consumers and unbundled the cost of the phone from the wireless plan — lowering the cost of the wireless service and reducing the overall bill after the phone is paid in full. Among other initiatives, the company introduced a $10/month subscription program called JUMP that lets customers upgrade to new phones more frequently without penalty.
T-Mobile has been steadily adding customers with what it describes as its “UnCarrier” approach. In many cases, T-Mobile’s moves have forced AT&T and other carriers to follow suit, and in this situation AT&T appears to be attempting to get out ahead of things.
If AT&T can successfully do that with the rebate plan, this situation would also show the risk of Legere’s outspoken approach. For a few weeks now, he has been teasing the company’s expected “UnCarrier 4.0” announcement, set for next week at CES, making it clear that something big is afoot — and giving AT&T a chance to do something first.
Stay tuned, we’ll post more as the official details emerge.