Mike Vizzoni, Front Rush
It’s 2017 and we are all glued to our phones. Constantly checking our favorite apps and social media platforms, most millennials spend more time on their phone then they do on a computer. So much time spent on our phones means that they need to function properly and we need the best connection as possible to keep up with all of our streaming, posting, and messaging. With such a high demand for a good wireless network the competition between the big wireless companies is more extreme than ever before.
As it stands, there are three main wireless companies that dominate the consumer space. Verizon, AT&T, and T-Mobile have been around for quite some time and all three are still doing very well. For a while these three companies operated in a rather similar fashion. They all would lock customers into contracts (usually 2 years) each offering a different combination of services that would fall under said contract. This model proved to be successful and is what most consumers are accustomed to. That is until about a year ago when T-Mobile really started the stir things up.
T-Mobile made a very bold move in 2016. They started tearing down the conventional walls that had been set up when it came establishing wireless plans. They got rid of contracts, who needs contracts if you like the provider you are paying for. Any new customers that came to them while in a contract with another wireless companies did not have to worry about paying to get out of their contract. T-Mobile would cover your costs to get out of your current contract. This was huge. It drew millions of people to T-Mobile and was the start of their renaissance. T-Mobile later introduced the device payment plan. This allowed customers to slowly pay off a new device they bought through T-Mobile. This made buying new phones much more affordable for many. Lastly, more recently T-Mobile said goodbye to data caps. They re-introduced the idea to have unlimited data. Data caps have been in place for years across the board on all major wireless companies. It was a great way for them to monetize data. They would set a per month price based on the amount of data you would like to use. This was thrown out the window when T-Mobile supported an unlimited data plan. T-Mobile now has no contracts, device payment plans, and unlimited data.
Needless to say, T-Mobile has added over 2.5 million new subscribers and their stock grew 50% in the last year. This all seems great for T-Mobile but what about the other two major wireless companies and all of their subscribers? Well this is the great thing about competition between companies within the same market. Once T-Mobile began introducing these revolutionary plans and services the other companies had to react. Verizon and AT&T started to release their own versions of no contract deals, device payment plans, and unlimited data. It was incredibly interesting to see these two companies completely change their pricing models simply to keep up with T-Mobile and to prevent losing more of their own customers.
This worked out great for us consumers and really goes to show how important competition is within marketplaces. Especially in tech.