A price rise by another name: enforced plan migration

T-Mobile are forcibly moving customers onto newer, more expensive mobile plans – just don’t call it a price rise. Why is America’s noble “uncarrier” resorting to devilish tricks and weasel words to justify price rises?

When is a price rise not a price rise?

When it’s a forced move to a new plan “at a different cost,” according to T-Mobile, which is pushing customers on older unlimited plans to migrate to newer, more expensive plans.

According to internal documents leaked on Reddit’s T-Mobile subreddit, notices will be sent to users on its older plans alerting them that their respective plans will change, and their monthly pricing will go up.

The level of increase depends on the plan, but most customers can look forward to a rise of $5-10 per month from November onwards. For example, customers on T-Mobile’s Magenta plan at $70 will find themselves paying $5 more on the Go5G plan, which launched in April this year. Business customers on its Simple Choice Business plan will also see themselves strong-armed onto the Business Unlimited Advanced plan.

Customers will receive an SMS or email formally notifying them of the changes. The company insists that those who don’t want to have their plan changed will be able to reverse the move, but they’ll need to contact customer care, where after listening to a pitch on why they should migrate anyway, they will be allowed to opt out of the migration – but only after it’s taken place. Currently, it’s unclear how long the window for customers to revert to their old plan is.

Customers using AutoPay can save $5 per line (on up to eight lines per account), however a recent change in automatic payment rules now requires customers to link a debit card rather than a credit card, which raises concerns considering their history of data breaches, the most recent of which saw 37 million customers’ details compromised.

The leaked documents include customer care’s nefariously worded talking points: “We are not raising the price of any of our plans; we are moving you to a newer plan with more benefits at a different cost.”

This wording means that T-Mobile isn’t technically reneging on its 2015 promise to not raise the price of its plans, as part of its Un-carrier 9.0 scheme, when then-CEO John Legere promised that prices wouldn’t go up. However, new management, it seems, is determined to undo many of the customer-friendly moves made during Legere’s tenure, such as scrapping wireless contracts.

T-Mobile had to agree to a number of conditions in order to proceed with its purchase of Sprint. One was that it would offer “the same or better rate plans” for three years. It's since introduced a Price Lock promise to not raise rates on plans, but this only applies to customers since April 2022.

T-Mobile’s justification for this migration plan is to deliver “more benefits” to customers, but what are these benefits? Beyond some extra high-speed hotspot data and 10GB of roaming data in Canada and Mexico, very little. Video streaming is stuck on SD only, and the bundled perks – a basic Netflix package and six free months of Apple TV+ – are the same.

It’s unknown whether customers who switch back to their old plans can do so for good, or if a reversal simply buys a little more time before they're again compelled to switch.

Sadly, from a cynical business perspective, this move makes perfect sense.

Many customers who pay little attention to their bill and don’t check their emails are unlikely to notice the price rise for some time, and those who do call will probably give up after being stuck on hold with T-Mobile’s customer service unit for hours.

AT&T and Verizon raised the price of legacy plans by stealth earlier this year, introducing new extra fees without raising the underlying plan price, inevitably forcing customers onto newer plans, often with fewer perks. T-Mobile has committed to not raising plan prices, so it seems coercion is their only recourse for squeezing more money out of customers.

T-Mobile has long prided itself on being unlike the other wireless providers, with its price promises and offering customers “uncontracts”. But were these commitments not sustainable in the long term? What can you offer customers to encourage them to spend more if they’re already getting unlimited minutes and data?

Despite boasting a lead in 5G speeds over its competitors, this is all for nothing if T-Mobile – or any carrier that tries this, for that matter – torches its reputation among customers with cynical price increases that don’t reflect an increase in quality of service.

Update [22/05/2024]: T-Mobile has now announced that the prices of monthly plans for some older smartphone plans will increase.

Talk to Cerillion now to see how our BSS/OSS suite can help you manage your products and price plans and keep your customers informed.