Thursday, February 12, 2009

And end of the gravy train?

Once again I am entitled to a handset upgrade from T-Mobile having had my smartphone for the last 12 months. 

Last year when I did upgrade to the HTC Touch I also had my tariff reduced to reflect that fact that this contract is for my second handset.  For the last year I have not utilised the voice or text bundle included in my tariff but have used the web'n'walk data plan to keep up to date on email.

This year T-Mobile have reduce the handset subsidy dependent spend and length of contract, even with an 18 month wait for my next gadget the handset would require me to pay something towards the handset.  Over the 16 years that I have been a customer of 0ne-2-one/T-Mobile I have never paid anything towards the handset.  So having been asked to make a contribution to the costs for the first time are T-Mobile saying that I lose money for them and so they want me to leave?  They must understand that I am unlikely to recommend then to family and friends and so as a plan this is not the same as a local restaurant switch to BYOB rather than renewing their alcohol license!

As someone who works in pricing mobile services I fully understand that handset subsidies only work when the subscriber uses the network.  The pay it forward method is broken if the consumer does not utilise the service because the handset is the second device and so the consumer in wanting up to date technology should make a contribution the the hardware.

The question for me as a consumer is should I wait until the unit cost of the handset drops to a level that means T-Mobile will give it to me or pay for the gratification of using the latest technology?  I know that as a customer of T-Mobile UK the technology is not that up to date and so the joy of a new gadget is limited.

I think that I will see if I can blag a new handset from one of my contacts at next weeks Mobile World Congress and witch to SIM only as the limited coverage of T-Mobile where I live and work means that it will always be my second line.  The current upgrade strategy must place churn high of the customer actions.


Anonymous said...

And don't press the "don't upgrade me, i'll take the £15/month discount" button if you have existing discounts - this will remove them. I had to then call Customer Services to get my free SMSs restored.

Mike1727 said...

Having just this moment left the St Albans tmobile store with an upgraded, free, phone I don't really understand what you're talking about. As someone involved in mobile pricing you should know that handset subsidies depend on what you pay per month regardless of usage as well as the economic situation. This means that if you have a low tariff in this economy noone will throw money at you. For an insider your views are pretty wide of the mark of what's really happening in the industry.

Ian Wood. Principal Wireless Foundry LLP said...


Should I wish to port my number to one of the other networks then I could get the handset that I was asked to pay for. That is part of the current lunacy of the Mobile in the UK. T-Mobile as one of the weakest Networks in the UK has the lowest Subscriber Acquisition Cost budget, something that cost the last MD and Marketing Director their jobs.

As someone who has overpaid for airtime for the last 12 months I feel that I should be able to get a discount on a new handset as something that might help retain me. I don't necessarily expect something for free but I do expect a more rational price plan from a Network who were the first in the UK to go SIM only.

Thanks for reading and I hope that explains what I was trying to say.

Anonymous said...

As far as I can see, service and pricing seem to be blind spots for most MNOs not just T-Mobile. In my case, thanks to the poor coverage by my MNO, O2, I am never able to use my mobile while at home. Calls drop abruptly and texts do not leave my handset for, sometimes, hours. The best connected part of the house is in front, at the roadside. But since that is part of my property, O2 is 'fulfilling the contract' and therefore unconcerned.

In a time when ARPU is dropping the MNOs need to deliver better QoS to encourage greater use. If I had better signal in my area, I would use my mobile a lot more than I do. Which would move me from my base rate (with its freebies) into a very high usage customer and make me more profitable for them. As things stand, I cannot use even the freebies and naturally come contract-end time, I will downgrade. And may be retain my old handset. It _is_ working after all (being a Nokia).

That QoS issue would in my view cover handset cross-subsidisation.