Just over two years ago AT&T and T-Mobile were set to merge into But for the U.S. Department of Justice that merger would have created the largest mobile provider in the U.S., further stifling competition.
Instead, CEO John Legere has turned T-Mobile, the fourth largest mobile provider in the U.S., into a pain in the sides of larger mobile providers - and a successful one at that. Throughout the past year, T-Mobile has introduced contract-free mobile plans, unlimited international data, and its "Jump!" service, which allows customers to upgrade their smartphones at a rapid pace. Verizon, AT&T, and Sprint all quickly formulated their own plans to compete with T-Mobile's offerings.
With subscribers now fleeing from AT&T at an increasing pace, AT&T is now confronting the problem in the simplest possible way: by throwing money at the problem. AT&T today announced that it will pay up to $450 per line to T-Mobile subscribers willing to switch over their subscriptions to AT&T.
Starting today, T-Mobile customers can receive up to the $450 payout depending on a few factors. Switching from T-Mobile to an AT&T plan will get subscribers a $200 credit towards their new plan. The other $250 is dependent on the condition of a smartphone that is traded into AT&T. Only the "latest and most popular smartphones" will get new subscribers the full $250, which will come in the form of a "promotion card."
This new move by AT&T shows just how much T-Mobile has shaken up the U.S. mobile market in the past year. It also demonstrates another factor that is quickly becoming a problem for U.S. carriers: that the number of new subscribers available in the U.S. is drying up. For consumers this should mean increased competition from all of the major carriers, as long as potential mergers continue to be kept in check by the DOJ.