T-Mobile’s Promotional Payoff
The news, reported by unofficial T-Mobile blog TMoNews and awaiting T-Mobile confirmation, isn’t surprising. Studies repeatedly show that consumers love free stuff, even when it comes with a two-year monthly recurring fee.
On Saturday alone, TMoNews says the fourth-largest US carrier’s Retail Channel added more than 110,000 customers, of whom 99,000 were postpaid subscribers. Reportedly, most of these users, totaling 28,000, came from the West Coast.
T-Mobile extended the free(ish) fest until today on Amazon.com Inc. (Nasdaq: AMZN), where it sold devices for a penny. Radio Shack also participated in the promotion over the weekend but hasn’t announced its sales numbers.
This is a move that other carriers would be wise to follow and that most already do for some of the more major holidays. For them, the cost of the phone --usually heavily subsidized anyway -- isn’t nearly as important as the $30 or so per month that comes with it. [Ed. note: OK, so ARPU isn't dead in all cases.]
For T-Mobile, in particular, it needed this help following a first quarter in which it lagged its larger competitors and struggled to keep subscribers. (See T-Mobile Hangs Growth Hopes on HSPA+ in US.)
Now I feel guilty for only getting my dad a lame card. — Sarah Reedy, Senior Reporter, Light Reading Mobile