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T-Mobile takes a jab at Verizon

May 06, 2015 Industry News
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For T-Mobile, it seems the sky is the limit when it comes to luring customers from its rivals. Though it has heavily focused on attracting customers from AT&T and Sprint in recent months, this week the “Un-Carrier” announced it had its eye on the prize – the customers of the nation’s largest carrier, Verizon Wireless.

t-mobile takes jab at verizonCalled the “Never Settle Trial,” the new promotion takes a jab at Verizon’s “Never Settle” LTE advertisements in name and will allow Verizon customers to take T-Mobile’s 4G network for a test drive – with little financial risk. During the trial, Verizon customers agree to port their number to a new T-Mobile smartphone, while keeping their existing smartphone through a two-week probationary period. If customers decide to stick with T-Mobile, the “Un-Carrier” will pay off any Verizon Early Termination Fees (ETFs) up to $650 or device payments when they trade in their Verizon phone and obtain a new device with T-Mobile. Those wishing to stay with Verizon simply return the trial phone to T-Mobile and any trial-associated costs and fees will be refunded via a Visa Prepaid card. Verizon customers have until the end of the month to sign up for the promotion.

“Last week, I said we would hit right back at Verizon – I meant it,” T-Mobile CEO and president John Legere said in a statement.

T-Mobile’s promotion is the latest in a series of lures the carrier is using to try to gain customers from its rivals. The carrier has promotionally allowed rival customers to try out its network since last June, but this is the first time it has specifically targeted another carrier’s customers for a trial. In many ways, the promotions have worked. During the first quarter earnings call last week, Legere said the company has had a long string of positive porting ratios. For Q1 of 2015, T-Mobile’s postpaid porting ratio was 1.9, an increase from 1.7 in Q4 of 2014.

“For the last five quarters, by the way, since Q1 of 2014, they have been positive every month against every carrier, no exception,” Legere said.

But the news is good for Verizon too. For the first quarter of this year, it reported adding 565,000 postpaid subscribers. That figure is less than the 620,000 industry analysts had predicted, but represents positive growth at a time when both Sprint and T-Mobile have released promotions aimed at recruiting customers from Verizon’s ranks.