John Legere (pictured), outspoken CEO of self-proclaimed ‘uncarrier’ T-Mobile USA, yesterday unveiled the next steps in his plans to shakeup what he calls “a stupid, broken, arrogant industry,” announcing a new initiative that enables customers to upgrade their devices twice a year while also touting expansion of its new LTE network. And, in typical fashion, he couldn’t resist badmouthing rivals AT&T and Sprint, weighing into the country’s recent M&A activity, and promising another move this year that his rivals can’t match.
Legere kicked off the media event in New York by reiterating his belief that the US mobile operator market is characterised by poor customer service. “I was absolutely shocked at what was going on in this industry and at how much people hated it,” he told the press. “This is the only industry I’ve ever heard where [putting the customer first] is called a ‘unique approach.'”
He claimed customers are “fed up” with AT&T and switching to T-Mobile “in droves.” Legere said that in a recent study, 26 per cent of likely cellphone switchers chose T-Mobile, far ahead of the other three, adding that AT&T’s porting ratio to T-Mobile before its ‘uncarrier’ initiative was 0.59. Afterwards, it was 1.75 (meaning more people are leaving AT&T for T-Mobile than the other way around).
Legere’s latest attempt to change public perception of his company is to allow customers to upgrade their devices more frequently that its rivals. Its JUMP! initiative is designed to enable customers to upgrade to a new device twice every 12 months at an additional cost of $10 each month, as long as they have been part of the programme for six months.
Referring to the mobile industry’s standard “one upgrade every two years” strategy, Legere proclaimed: “Customers think it’s crazy, I think it’s crazy. Contracts and limitations work for carriers, they don’t work for you. It is all about greed — it’s better for carriers than it is for you…Two years is too long to wait. 730 days of waiting. 730 days of watching new phones come out that you can’t have. 730 days of living with a cracked screen.”
He continued: “AT&T and Verizon just went from 20 months of pissing you off to 24. What’s next, 36?… Do you even remember what phones were around two years ago? You should decide when to upgrade, not your wireless company.”
When questioned on how the company expects to generate profit from this strategy, the exec claimed there is a healthy untapped market for refurbished devices at lower prices.
Chief Marketing Officer Mike Sievert joined Legere on stage, calling JUMP! “our signature move of Uncarrier 2.0.”
“The industry is going the other way. The other guys are lengthening their upgrade cycles,” Sievert added. The CMO also unveiled a new family-plan program, enabling families to get four phone lines with unlimited talk, text and Web and up to 500MB of high-speed data for $100 per month – with no credit check or annual service contract required.
Moving onto its progress with LTE, Legere introduced CTO Neville Ray, but not before taking a swipe at Sprint: “Sprint has missed every possible deadline for its LTE network rollout.”
Ray provided an update on T-Mobile’s LTE plans. “By July 1st, we had 157 million people in 116 metro areas covered with LTE,” he stated. “We didn’t start adding LTE until just over 6 months ago.”
Ray also joined Legere in mocking Sprint’s LTE efforts: “We are in 73 of the top 100 markets in the US. Sprint is in 22. They are still talking about Manhattan in Kansas. We’re talking about Manhattan in New York!”
The CTO expects to hit 200 million POPs by the end of the year, with its LTE network averaging download speeds of 10-20Mb/s compared to AT&T and Verizon’s promise of 5-12 Mb/s. He also talked up the operator’s LTE device portfolio: “It’s not just the iPhone and the GS4, we’ve got everything!”
T-Mobile’s event yesterday marked the latest move by the fourth-largest US operator to claw back market share from rivals. Legere’s bold approach first made headlines in January at CES and the company then used a press event in New York in March to unveil its no-contract, uncarrier strategy. And there’s more to come. In an interview with CNET, Legere said “Phase 3” of the company’s challenger programme will debut this year and address another frustration that “drives people nuts about the industry.”
Finally, Legere also revealed he’d be open to potential combinations with Dish Network or even rival Sprint. “Strategically, we look at all options,” he told CNET.