John Legere (pictured), the outspoken boss of T-Mobile US, is ruffling more feathers in the mobile industry by scrapping what he says are insanely high charges for international connectivity.
Speaking at a concert event in New York, he said the cost of staying connected across borders was “completely crazy”.
“Today’s phones are designed to work around the world, but we’re forced to pay insanely inflated international connectivity fees to actually use them,” he went on. “You can’t leave the country without coming home to bill shock.”
In keeping with his ‘un-carrier’ approach – which has already seen T-Mobile US binning long-term contracts and introducing early device upgrade plans – Legere’s answer is to turn his back on the US practice of charging what he calls “exorbitant” international roaming rates.
“It doesn’t have to be this way,” bemoaned Legere. “The truth is that the industry’s been charging huge fees for data roaming. But what’s most surprising is that no one’s called them out – until now.”
Starting from 31 October, T-Mobile US consumers and business customers that are signed up to its ‘Simple Choice’ plan automatically get unlimited data and texting in more than 100 countries worldwide. Moreover, they will only pay a global flat rate of $0.20 per minute for voice calls when roaming in those same countries.
The Simple Choice plans start at $50 per month. And for a $10 monthly fee, T-Mobile US customers can make unlimited calls from home to overseas landlines in around 70 countries.
According to T-Mobile US figures, Americans take about 55 million trips abroad every year. But when they use their phones abroad the way they normally do at home, they typically get slammed with bills of $1,000 a day or more.
It means more than 40 per cent of customers turn off data roaming completely, while another 20 per cent said they would if they knew how.
In an interview with CNET, Legere laid into AT&T to illustrate the heavy cost burden of roaming. He claimed that if an AT&T customer, in a day, used 72MB of data, made 32 one-minute calls back home, and sent 36 text messages without an international plan, the cost would be $1,150 if the person was in Canada. In Europe, said Legere, the cost would jump to around $1,500.
Legere added that the larger carriers enjoyed roaming profit margins of around 90 per cent.
According to chief marketing officer Mike Sievert, quoted by Reuters, T-Mobile US currently charges $10 to $15 per megabyte of data for overseas data roaming fees.
However, the operator does not expect much of a decline in revenue from the new offers as T-Mobile US’ roaming revenue is much less than its rivals. That gives Legere much more leeway to make his headline-grabbing move.
LTE speeding up
Alongside its move to scrap roaming fees, T-Mobile US announced its ‘4G LTE’ network is now “nationwide”, reaching more than 200 million people in 233 metros across the US.
In recent third-party tests, T-Mobile US claims that its 4G LTE nationwide network delivered faster speeds than the 4G LTE networks of Verizon and Sprint.
The operator further boasts it already has faster median speeds than AT&T’s 4G LTE network in 10 of the top 20 metropolitan statistical areas.
“We were damn close to having in this release a claim that we are now the nation’s fastest 4G LTE” network,” said Legere in a telephone interview with AllThingsD.