CEO John Legere has focused most of his recent Twitter vitriol on
, he can never resist taking a dig at
. Legere has built his company, which has been adding subscribers
every quarter for nearly two years, by being willing to attack
AT&T is a favorite target because the company has managed
to remain part of the big two in the mobile phone world, along
, despite offering higher prices. These price disparities
have grown in recent months as T-Mobile (and now Sprint) have
aggressively lowered costs for some plans.
Though Legere has advertised this fact extensively through
raucous commercials that push price and the company's
"Un-Carrier" branding, one of his go-to tools has been waging a
one-sided Twitter war. AT&T and its executives have stayed
above the fray, which has not stopped Legere from lobbing Tweet
grenades even when there is no particular news reason to do
If you're paying $160 for a 'best ever' family plan from
, you must be living under a rock. Try 4 for $100 from
- John Legere (@JohnLegere)
August 18, 2014
That Tweet is just one example of Legere's targeting of
AT&T on Twitter. In August alone he repeatedly went after his
rival (along with Sprint and Verizon) on the social media
service, though it should be noted that his posts with the most
retweets were generally his ones touting T-Mobile deals not the
ones going after his competitors.
What is T-Mobile doing?
In boxing, lesser fighters have always tried to get better-ranked
pugilists to notice them. A brash challenger who calls out the
champion subtly elevates himself to the level of the titleholder.
If the champ takes the bait and gives him a fight, the upstart
can either take the title or at least prove he belongs in the
In the case of Legere and T-Mobile, he's calling out the
industry leaders both to elevate his company and to gain
public trust. By saying AT&T charges too much he has
effectively broken the unspoken code of the mobile phone
business. AT&T and Verizon have been content as co-leaders
for years. They run ads based on network quality or touting
branded offerings, but they never do anything to upset the apple
cart of how the industry operates.
It's very similar to how cable companies have always worked.
There might be competition for customers (though cable companies
often have geographic monopolies) but everyone offers roughly the
same prices. The satellite companies shook up cable a little bit
as they did cut prices, but fears of unreliability largely made
them fringe players. The same had always been true in mobile
phones where the low-cost options were dubious, little-known
By breaking tradition and saying, "Hey, we can charge less and
still make money," while simultaneously casting his company as a
worthy alternative, Legere has given customers a real option.
T-Mobile has added at least 1 million subscribers in each of
the last five quarters. The growth for T-Mobile has not had a
major impact on AT&T or Verizon, which both gained millions
of wireless phone subscribers in 2013 (more than 5 million for
Verizon and nearly 3 million for AT&T).
Legere may have gotten T-Mobile in the ring, but
he's still more cute annoyance than legitimate threat. That's why
even when his real focus is on taking customers from Sprint in
order to move into the No. 3 spot, he's still taking shots at
AT&T's offer vs T-Mobile's
Of course, if you live someplace that is well-served by the
T-Mobile Network, Legere is correct in saying that his company
has a better offer. For $100 T-Mobile is offering users four
lines with unlimited talk, text, and data. The plan includes 10GB
of 4G LTE data (2.5GB per line). After a phone uses its 4G
allotment, it still gets data for free with no overages, but
delivery speeds slow down.
AT&T's plan is identical except for two major things.
- After the data allotment is used, overage charges
- It costs $60 more per month.
Both companies are offering their family plans without device
subsidies. That means customers must either bring their own
phones, buy them for full price, or finance them (usually over 24
months). Both show almost identical device prices (aside from
some refurbished models) so that's not really a factor.
As for networks, RootMetrics recently released its
of the various carriers for the first half of the year. Verizon
was on top with a score of 81.6 (out of 100), while AT&T was
next (79.5), and T-Mobile came in third (71.5). In those
rankings, AT&T has a clear edge over T-Mobile in all
categories -- specifically "coverage," which the research company
defines as "reliability plus speed." There are clearly still some
holes in the T-Mobile network, but the company has been gaining
on its rivals and it continues to pour money into
Can T-Mobile take down the giant?
If price is the only factor then T-Mobile clearly has it over
AT&T. The problem is that while more people are taking
T-Mobile seriously, the company is still seen by many as a
small-time player and the deficiencies of its network sometimes
back that belief.
Legere is right to keep slinging rocks at the giant that is
AT&T but it will likely take more than price to win market
share at its bigger competitor's expense. If T-Mobile can
continue adding customers who have a good experience when its
comes to network reliability, and they then spread Legere's
gospel, then T-Mobile can be a real player.
Leaked: Apple's next smart device (warning, it may
Apple recently recruited a secret-development "dream team" to
guarantee its newest smart device was kept hidden from the
public for as long as possible. But the secret is out, and
some early viewers are claiming its everyday impact could
trump the iPod, iPhone,
the iPad. In fact, ABI Research predicts 485
million of this type of device will be sold per year. But one
small company makes Apple's gadget possible. And
its stock price has nearly unlimited room to run for
early-in-the-know investors. To be one of them, and see
Apple's newest smart gizmo, just
T-Mobile CEO Steps Up Twitter War With
originally appeared on Fool.com.
has no position in any stocks mentioned. The Motley Fool has no
position in any of the stocks mentioned. Try any of our Foolish
free for 30 days
. We Fools may not all hold the same opinions, but we all believe
considering a diverse range of insights
makes us better investors. The Motley Fool has a
Copyright © 1995 - 2014 The Motley Fool, LLC. All rights
reserved. The Motley Fool has a