It’s too soon to end the Uncarrier experiment

December 15, 2013

Gary He/Inisder Images/Handout/EPA

It's been two years since AT&T's attempted purchase of T-Mobile fell apart. Now, T-Mobile is reportedly in Sprint's crosshairs.

Whether Sprint succeeds in buying T-Mobile will depend a lot on the Federal Communications Commission. While the regulatory approval process could sink the proposed deal over antitrust concerns, the FCC may also conclude that a merger would preserve wireless competition. Either way, Friday's  report suggests that T-Mobile is still a big, tasty morsel — and that's a sad thing, because with the least to lose of the four major carriers, T-Mobile has been the most willing to challenge the rest of the industry's M.O.

The business needs a T-Mobile. Its "uncarrier" attitude offers an important foil to the likes of Verizon and AT&T. The company's tactics, which include divorcing handset prices from contract payments, free international data roaming and a habit of openly needling AT&T, have won it hundreds of thousands of new subscribers recently, with more growth likely on the way. T-Mobile expects to finish the year having added 1.8 million post-paid customers. The Verge sums it up graphically:

(The Verge)
(The Verge)

After years of serving people with a kind of 4G-lite called HSPA+, T-Mobile finally switched on LTE across the country in October. The company is also reportedly in talks with Verizon to purchase as much as $3 billion in wireless spectrum that would allow it to expand its network capacity.

With the latest flurry of activity, it's as if T-Mobile is trying to tell consumers it's too soon for it to disappear. The company has only just begun to see the fruits of its unconventional economics, reversing a long period of stagnation.

Sprint is doing some innovation of its own, to be sure. It's got wholesale partners that are betting big on technological trends most consumers aren't in a position to appreciate.

Yes, the Uncarrier strategy comes with caveats. You technically still have to sign a contract to pay a phone off in installments if you don't buy it unsubsidized from the beginning, for instance. The important thing is that it's not a service contract; if you want to walk away, just pay off the rest of your device and you're free to go.

Merging with Sprint wouldn't necessarily be the end of all that. But the deal potentially puts a relatively young and important experiment at risk.

Brian Fung covers technology for The Washington Post.
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