T-Mobile will not move forward with plans to switch certain customers from older unlimited plans to newer, more expensive ones, following a major backlash from customers, Mike Sievert said during the company’s third-quarter earnings call.
An October 10 article in The Mobile Report (TMR) revealed that the plan was to force users of older unlimited cell phone plans to one of the company’s newer plans. The “forced plan migration” would have resulted in a monthly increase of about $10 per line, or $5 per line if those users sign up for AutoPay, TMR reported. The new rates were set to begin in November billing cycles unless the user called T-Mobile’s Customer Care support line to opt out, it added.
News of the planned migration leaked earlier this month, which sparked an immediate customer backlash, with many users lashing out on T-Mobile forums and on social media.
In response to a conference call question about the “unwelcome press” that the plan had received, Sievert said that the plan had been meant to be a pilot test to better “understand customer interest in and acceptance of migrating off old legacy rate plans to something that’s higher value for them and us." However, the plan was leaked “not very accurately” as a national plan, he said.
“We did get plenty of feedback, thanks to the erroneous context of the leak. And I think we've learned that particular test cell isn't something that our customers are going to love,” Sievert said. “We aren’t doing it.”
While T-Mobile’s plan to switch customers to pricier plans got derailed quickly, several major tech companies have announced price increases recently that appear to be here to stay.
In October alone, Apple raised prices for four services, Netflix hiked the price of its basic and premium plans, and Warner Bros. Discovery raised the price for its Discovery Plus ad-free monthly subscription in the U.S.
In September, Amazon Prime Video announced it will place ads in its Prime Video streaming service in early 2024 unless members opt for an ad-free version at a rate of $2.99 per month.
In August, Disney announced price hikes for its monthly ad-free Disney Plus and ad-free Hulu plans.
Married to your mobile carrier
Despite rising costs, household mobile and internet spending is unlikely to fall, according to a study of 7,000 people earlier this year. Respondents said they would reduce their electricity, heating and car payments before home internet or mobile service, as Kipling previously reported. This may be because changing providers can be a hassle.
When shopping for a new wireless plan, there are several ways to save money, starting with getting a plan that covers your specific data use. Also, while the major carriers can offer tempting deals, don’t neglect to take a look at smaller carriers, which may offer new-customer deals that fit your needs.
Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
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