Invites for T-Mobile’s(s tmus) Consumer Electronics Show press event are hitting inboxes and speculation is that the carrier will announce a new strategy to get you on its network. As part of its “Uncarrier” effort, the idea would be that T-Mobile would pay the contractual Early Termination Fee (ETF) from your current carrier so you could switch to T-Mobile which no longer has contracts. The rumored plan is dubbed “Houdini” says the TMoNews blog.
I have my invite and I’ll be on-site to hear what the carrier has to say on January 8. The news could be the payoff of existing contracts or something else entirely. It’s interesting to consider the possibility of the network operator paying off contracts in order to boost its subscriber count. Two or three years ago, it would have been far less interesting, however.
As other U.S. network providers were building out LTE networks, T-Mobile stayed the course with HSPA+ technology. In some cases, HSPA+ can be nearly as fast as today’s LTE mobile broadband speeds, but in general, it’s not quite as cutting edge. Coverage outside of major cities has been an issue as well for the carrier. So what has changed that could actually get people to consider switching to T-Mobile?
For starters, T-Mobile has aggressively implemented LTE across the U.S. with 203 million people in 254 markets covered by LTE; just eight months after the rollout began. Last month, T-Mobile doubled speeds in 40 of the top 50 metro markets and it plans to double down again in 2014. It certainly helps that T-Mobile gained a nice chunk of spectrum as a concession from the failed AT&T(s t) deal, allowing it to boost speeds and coverage. The carrier also gained key airwaves through its Metro PCS merger.
All of a sudden then — two years is pretty quick when it comes to carrier infrastructure — T-Mobile has a relatively formidable network with better coverage than it did before. Combine that with services unbundled from device hardware, no contracts and a clever phone upgrade program and you’ve got a recipe for adding customers.
Contracts then — the ETFs for them, to be more precise — may be the the biggest currently hurdle in switching from Verizon(s vz)(s vod), AT&T, or Sprint to T-Mobile. And if the planned January 8 event does remove that hurdle by having the carrier paying customers to switch, it could drive a fair number of customers to do just that.
Again, we don’t know if this is what T-Mobile plans. And if this happened two years ago, the answer to “would you switch?” would likely be a no for most people.
This isn’t the same T-Mobile as 2011 though, so what do you think: If the company is willing to pay off your ETF, will you make the move?