Price War! AT&T Mobility offers T-Mobile USA users up to $450 credit to switch

“AT&T Inc on Friday offered customers of No.4 U.S. mobile provider T-Mobile U.S. Inc a $200 credit to switch to its service, firing the first volley in what may be a price war that benefits consumers but plays havoc with profits,” Sinead Carew reports for Reuters. “AT&T, the No.2 U.S. mobile provider, announced the promotion after months of direct marketing against it by T-Mobile, and in anticipation of a new competitive offer from its smaller rival on January 8.”

“The move might kick off a year of discounts from U.S. wireless operators, who are increasingly dependent on price to compete because they all offer similar phones and any network advantages are hard to prove,” Carew reports. “MoffettNathanson analyst Craig Moffett described AT&T’s move as the ‘early makings of a price war’ that might boost customer switching, also known as churn.”

“Wells Fargo analyst Jennifer Fritzsche said AT&T was likely reacting to speculation that T-Mobile’s January 8 offer could include a credit to customers switching from AT&T contracts that covered early contract-termination fees.,” Carew reports. “In an effort to steal T-Mobile’s thunder, AT&T said that, beginning on January 3, in a limited-time offer, T-Mobile customers who switch to AT&T will receive a $200 credit per line, which includes family plan customers. The per-line credit could be on top of another credit of up to $250 if the customer trades in their current smartphone. While it said trade-in values vary based on the model and age of the smartphone, many of the latest phones will qualify for the $250 credit.”

Read more in the full article here.

[Thanks to MacDailyNews readers too numerous to mention individually for the heads up.]

8 Comments

    1. Good point. P*ss off you own customers to try to grab your competitions. Since they are larger T has more to customers to lose to T-Mo than vice versa. I am staying with T-Mo. Like my plan and unlike Obamacare, I can keep it.

  1. Lemme guess, AT&T is paying $200 for the right to lock you into a contract. Not sure how this would fly given that much of TMo’s recent growth has come from customers looking to escape from the endless cycle of overpriced two-year contracts.

    The rumored TMo plan is much more enticing because they would pay the termination fee to anyone still on contract from a competing carrier, and the TMo service then would be contract-free.

    1. Last I heard, T-Mobil has a data plan for $30./month that includes 5GB of data and 100 min of talk time.

      My guess is that this is making a dent in ATT’s profits. Probably the reason why Sprint wants to buy them as well…

  2. Just like the congressman from Georgia ‘Lies, straight from the pit of hell’.. Break down the ATT offer into it’s constituent parts and the REQUIREMENTS of each part… The programs actually ends up costing you $500 or more !!! Do the math… Look at the rules. You’ll laugh yourself into a wall.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.