RSS Feed
TwitterT-Mobile USA, hoping to stem the loss of its most-valuable customers, began offering a $200 credit to business customers looking to switch to its service.
New customers who sign up will get a $10 credit for 20 months after the line has been active for 90 days. The credit was quietly offered starting last week.
The move is a response to Sprint Nextel Corp.'s (S) own efforts to poach customers away from its rival carriers. Last month, it began offering a $125 credit to new smartphone customers and $175 to business customers.
Sprint specifically targeted T-Mobile with its incentive, and a T-Mobile spokesman said its new offer is designed to win customers back.
T-Mobile, a unit of Deutsche Telekom AG (DTE.XE, DTEGY), is attempting to keep a business-as-usual outlook as it looks to be snapped up by AT&T Inc. (T) in a proposed deal that is making its way through the approval process. In the meantime, the carrier has suffered from heavy customers losses--particularly from lucrative consumers who are dropping their long-term service contracts.
Carriers have previously offered such incentives to switch, typically tied to specific handsets or to third-party retailers. These programs are designed to spark quick customer growth and are seen as a better alternative to permanent price cuts. Sprint's move to offer a blanket credit is more rare, but has now been followed by T-Mobile.
The offer will likely cut into near-term earnings and increase T-Mobile's subscriber-acquisition costs. But the carrier hopes it can realize a stronger long-term benefit from the converted customer.
New customers who sign up will get a $10 credit for 20 months after the line has been active for 90 days. The credit was quietly offered starting last week.
The move is a response to Sprint Nextel Corp.'s (S) own efforts to poach customers away from its rival carriers. Last month, it began offering a $125 credit to new smartphone customers and $175 to business customers.
Sprint specifically targeted T-Mobile with its incentive, and a T-Mobile spokesman said its new offer is designed to win customers back.
T-Mobile, a unit of Deutsche Telekom AG (DTE.XE, DTEGY), is attempting to keep a business-as-usual outlook as it looks to be snapped up by AT&T Inc. (T) in a proposed deal that is making its way through the approval process. In the meantime, the carrier has suffered from heavy customers losses--particularly from lucrative consumers who are dropping their long-term service contracts.
Carriers have previously offered such incentives to switch, typically tied to specific handsets or to third-party retailers. These programs are designed to spark quick customer growth and are seen as a better alternative to permanent price cuts. Sprint's move to offer a blanket credit is more rare, but has now been followed by T-Mobile.
The offer will likely cut into near-term earnings and increase T-Mobile's subscriber-acquisition costs. But the carrier hopes it can realize a stronger long-term benefit from the converted customer.
