This Op-Ed first appeared on CNBC.com
CNBC Guest Editorial
John Legere, President & CEO, T-Mobile
“Someone like you. Someone who will rattle the cages.”
If you believe the buzz, the regulatory environment is about to change. And that has a lot of U.S. business leaders feeling pretty optimistic. I’m one of them, but I’m also worried and more than a little pissed off at the current state of our industry.
You see, for years, the industry I work in has enjoyed a well-earned reputation for screwing its customers. The long-time incumbents have had a death grip on one of the most important services of our time—mobile access to the Internet. And they’ve taken advantage of their Duopoly position at every turn. Left unchecked by disruptive forces (like T-Mobile), what would these companies do?
This question matters. Your phone today is so much more than just a gadget – it’s a lifeline. It’s how you communicate, stay connected, navigate the world, have some fun and so much more. Today, the internet is mobile. Mobile is the internet. Everything—from the latest blockbusters to your bank statements—is online. And, this year, a full 75 percent of all internet use in the U.S. will happen on mobile devices.
So, when I see the others trying to tax, toll and restrict access to the mobile Internet, it pisses me off! You see, I believe big businesses and their leaders have a huge responsibility, especially in a less restrictive regulatory environment, to ensure the average Joe and Jane are being treated right.
After all, that’s exactly what we’ve been doing at T-Mobile – rattling corporate cages and challenging the status quo. Over the past four years, again and again and again, we’ve listened to wireless customers, shone a bright light on their biggest pain points, challenged the industry to change and started that change at T-Mobile first.
That simple Un-carrier formula has worked. We ended those ridiculous two-year service contracts, and the industry followed. Now, 155 million Americans are contract-free. We eradicated $1.3 billion in break-up fees across the industry, so customers can change carriers when they want without penalty. We ended punitive overages, and now up to $2.4 billion a year in overage penalties are on their way out. And those are just a few of our Un-carrier moves that have changed wireless.
Just last week, we did it again. We called out this industry’s practice of piling monthly surcharges, fees and added taxes on customers’ wireless service plans—so the amount carriers advertise is never the amount customers pay. This is a HUGE problem. Collectively, U.S. wireless customers pay $17.2 billion a year in these extra charges. It’s just wrong, and we got rid of it.
We also took aim at this industry’s practice of suddenly jacking up your price after months, and sometimes years, with almost no warning. Our competitors hiked prices on their existing customers 22 times in the last four years (that we could find). Why? Why not. They hold all the power. Last week, we formally gave customers – and only customers – the power to change the amount they pay.
But you know what happened next? The carriers poured a huge bucket of cold water right over the heads of US wireless consumers:
- The day we made our announcement, Verizon jacked up its activation and upgrade fees by a full 50%.
- Just days later, AT&T jacked up prices by $5 / month on its most loyal customers—everybody who’d signed up for an unlimited plan before 2011.
- Verizon kicked unlimited customers off its network for going over their data limit. On an unlimited data plan. I can’t even.
- And those Sprint customers who thought they were getting half off are in for a nasty surprise, as even Sprint admitted their 50% promo started expiring for some customers in early 2017.
That abuse of power damages customer trust across the entire wireless industry, which is good for absolutely no one.
But, of course, carriers aren’t the only culprits in corporate America. Airlines are a classic, tragic example of this. How about those added hotel fees? Take a look at car dealerships. And tickets to anything. Not to mention the cable companies finally coming under the scrutiny for all those hidden extra monthly fees. It’s out of control.
So, moving forward, it’s going to be increasingly critical for great brands to build and flex their own ethical muscle. Customer trust is too important. US consumers deserve better.
Fighting for customers isn’t just the right thing to do. It’s good business. Just ask a T-Mobile shareholder.