T-Mobile celebrates reaching more than 200 million people nationwide with it's 4G LTE network with a special event for customers featuring Shakira in New York's Bryant Park on Wednesday, Oct. 9, 2013. T-Mobile has also extended unlimited data and texting to Simple Choice customers traveling in more than 100 countries. (Jason DeCrow/AP Images for T-Mobile)

Android Headliner: Legere’s T-Mobile Is All Style & Little Substance

November 18, 2015 - Written By John Anon

Last week, T-Mobile held their latest uncarrier event and announced the next in their line of ‘uncarrier moves’, releasing video from its data prison. Whitelisting video content providers so T-Mobile customers do not run up extraordinary charges through all the YouTube cat videos they are watching. Except, YouTube is not one of those whitelisted. The official toeing the line reasoning is something to do with the way in which T-Mobile recognizes YouTube videos as, well, video. Sounds strange to say but it sounds even stranger to hear. In fact, it sounds even stranger when at the back of your mind, you consider YouTube also happens to be smack bang in the middle of their latest attempt at monetizing the platform. Coincidence? Maybe, maybe not. The truth is no one except the powers-that-be know. Although, “powers-that-be” sounds much more carrier-like than uncarrier-like.

In fact, last week is when the first glimpses of the Legere tenure of T-Mobile started to show its actual carrier roots. So much so, that the future with T-Mobile is suddenly looking much more interesting from the observer point of view. T-Mobile did announce Binge On and did also announce the ‘doubling of data’. However, there was also a hidden price hike for certain plans. A move many thought was a little deceiving as there was no mention of the increase during the big event. Over the last couple of years, T-mobile has made a name for themselves by being ‘not a carrier’ and instead being ‘the consumer’s friend’, the ally of those who are forced into contracts, forced into high monthly payments and forced to be capped with their data. But T-Mobile is not yours, mine or anyone’s friend. No matter what the branding or tags they attribute to themselves. They are not an uncarrier but very much a carrier and Legere is not the laid back, freedom fighter that he or T-Mobile portray him to be. He is an extremely clever, astute and business-savvy CEO, one who knows exactly what it takes to get what he wants, to ‘win’.

The image we see of Legere is a very different image to the Legere who existed ten or more years go when he was chief operating officer for Global Crossing. In that position, he was and represented everything that he accuses ‘dumb and dumber’ of representing. In his sharp suit, sharp haircut and sharp wit, he was every much the AT&T or Verizon that he now stands against. Although, this is somewhat to be expected as he did spend almost two decades working for AT&T (‘dumb’ or ‘dumber’, it is never that clear which is which in Legere’s mind). For those unaware of the Legere of before, you can watch him adopting a very dumb and dumber look, style and delivery of content in the video below. It is worth mentioning, the video does show Legere talking about AT&T and Verizon as well, although there is no mention of “dumb and dumber” or any other derogatory comments. Instead, Legere describes the duo as “big players getting bigger”.

The Legere of today is very far removed from the Global Crossing CEO. Now Legere sports longer hair, magenta colored clothing, CEO branded sneakers and a much more relaxed look in general. Ironically, Legere now refers to dumb and dumber as “the suits”, as if he was never part of that click. This is not all by accident, though. This is very much a clever marketing move by Legere to appeal to a very specific consumer base. Legere is often heard, during many interviews referring to his user base as “young: and “cool” and this is exactly who Legere and T-Mobile are looking to recruit. Hence why even his use of language in the public forum has changed, with Legere now seeking every opportunity to drop an F bomb, throw in a porn reference or any underhanded comment he thinks of on-the-fly. It is all good TV and one with a view to impressing (and maintaining) that younger demographic by being the ‘cool carrier’.

The sudden and almost overnight metamorphosis of Legere is not that surprising though, as the one commonality between the Legere of then and the one we see now, is that they are both willing to do whatever it takes to turn the company around. And make no mistake, Legere achieved this with Global Crossing. If you believe the rumors, he did so with an iron fist. He is a master at this sort of thing and one aspect which seems to resonate very clearly between Global Crossing and T-Mobile is the notion of cheap. During his time at Global Crossing, Legere was known for introducing massive cost-cutting measures to help adjust the balance sheets and this is something he is believed to have implemented when he first walked through the T-Mobile doors as well. Although, with T-Mobile he took ‘cheap’ to the next level, the consumer level, by offering consumers plans that were as cheap as possible. To be clear, this is not a means of undercutting the competition, as to undercut someone, you do need to be offering the same level of product, service or content. You cannot claim to undercut if you are offering cheap for a cheap product and when Legere took over at T-Mobile that is all they had to offer. A lesser level of coverage, a lesser level of service, a lesser product. So it stands to reason that it should be cheaper. But Legere has taken this idea of cheap, wrapped it in magenta and sold it directly to the public.

mobile internet T-Mobile

You may be wondering why if this is about T-Mobile, there is so much focus on Legere so far? Well, Legere has made it so that it is impossible to talk about one without the other. In fact, this has been his end game since the beginning. Legere will be the first to tell you that he is a walking T-Mobile advertisement, an embodiment of T-Mobile, if you will. And he is not wrong. He has made it so T-Mobile acts, looks and feels like he does. Again, astute business tactics. By buying into T-Mobile’s credibility, you are in fact, buying into Legere’s credibility and vice versa. He is the underpinning and sole driving force being the resurgent T-Mobile. Which by the way, seems to be another dose of smoke and mirrors. T-Mobile has never been in a better position. That much is true. They are pulling in continuous and consecutive positive churn rates, which is commendable and Legere does deserve to take all the credit for that. Not to mention, T-Mobile is also seeing consecutive periods of positive porting ratios. However, if T-Mobile is to be believed (Legere, in reality), then they are directly taking those customers from dumb and dumber. But are they really?

A recent(ish) study by Chetan Sharma Consulting yielded some interesting results. The figures are based on the market share of wireless subscribers occupied by all the main wireless carriers in the U.S. and spanning from Q1 2011 through to Q2 2015. So realistically, more than sufficient enough to cover Legere’s residence at T-Mobile. To throw a few numbers your way, back in Q1 of 2011, Verizon occupied 33% of the market, AT&T occupied 32% of the market and in terms of the ‘big four’ T-Mobile trailed quite substantially on 11% (for those wondering, Sprint occupied 17% of the market at the time). Fast forward to Q2 2015 and what numbers would you expect? Well, according to the same data, in Q2 2015 Verizon occupied 33% of the market and AT&T occupy 34% of the market. T-Mobile had made substantial gains and by Q2 were riding high on 16% of the market share (the same percentage as Sprint). So if, T-mobile has climbed five points since 2011, Verizon had remained static, Sprint has lost only 1% market share and AT&T has actually gained 2 percentage points, then where has T-Mobile picked up those points from?

market share 2015

Well, even these figures are not as clear-cut or as truthful as they sound. Much is the case for the murky market that is the carrier industry. The 2011 figures for T-Mobile were in the absence of MetroPCS, which is not the case for 2015. In 2011, MetroPCS occupied 3% off the market which we had previously not factored into the equation. So if we were to crudely take MetroPCS and add them to T-Mobile’s tally, then we would be running at and about the 14% level for 2011. Now the numbers start to make a little more sense. Two percentage point gains (coincidently the same at AT&T) over the years. Although in fairness, AT&T’s two points have come through Leap Wireless in much the same fashion that we have attributed the MetroPCS figures to T-Mobile. And T-Mobile have genuinely made up their additional two percentage points through organic growth, but if you look at the numbers then they have been picked up from Sprint and U.S. Cellular. Even if you remove the 2011 Leap Wireless share from AT&T again, the figures still show that in terms of overall market share, AT&T and Verizon have not really budged since 2011. Yes, there has been highs and lows in the periods in between, but there has been for everyone, including T-Mobile. Of course, you could delve deeper and look at the post-paid, pre-paid, churn rates, individual port ratios and use any of them to find the figures you want to back up a point you want to make about any of the carriers. So to avoid any of that, if we just take these figures which are said to represent overall market share, then T-Mobile’s impact on the dumb and dumber is not so, well, impacting.

In fact, this is likely the reason as to why Legere continues to attack the two in every opportunity that arises. If you were single-handedly taking all your new sign-ups right out of the pocket of dumb and dumber, then why would you need to continue to attack them? What would be the point? You have already won…right? And there is the bottom line, T-Mobile have not won and in fact, are extremely far away from winning, at least when it comes to dumb and dumber. So much so that Legere needs to continue the tirade to ensure that the perception is they are damaging the big two.

Yes, T-Mobile or Legere (they are interchangeable by now) are winning the social media wars, they are winning the headline wars, they are winning in many instances. But sometimes the truth is in the pie. In spite of all the profanities, all the ‘porn’ referencing, all the remarks thrown at AT&T, Verizon, Sprint, Trump and anyone else who stands in the way of Legere, there is the inescapable truth that the service, the product, offered by T-Mobile is not only drastically trailing dumb and dumber, but it is also below par for the company that they claim to be. T-Mobile coverage is spotty at best, their cellular coverage in particular, is extremely poor in certain areas and they just still do not have the infrastructure in place to be a viable contender. Interestingly, this is a point Legere is almost always asked when he appears on any public outing and generally the question is diverted by Legere telling the interviewer that T-Mobile has extended the LTE range by another million square miles and you must be living in a cowshed to not pick up the signal, which again is great TV but avoids the issue. There is little point in telling people the signal in their area is great when they are telling you that it is not.

The hard cold truth is that T-Mobile will never be a serious contender until they cement the foundations that are needed to be a major carrier in the U.S. Too much time is spent by T-Mobile on being cheap, throwing cheap comments, offering cheap contracts and offering a product that can only be described as cheap and not enough time is spent on actually improving the customer experience for the customers that T-Mobile already has. Of course, those customers T-mobile already has is not their concern. They are maintaining a good churn rate and as such, the customers they have are happy paying less and receiving a lesser product. While some might argue that Binge On or Music Freedom means they are getting more of a product, we are talking about the fundamentals here – reliability of service, coverage and so on.

Of course, there has been numerous moves by the carrier to improve the user base but how useful have these been? So far, we have had the abolishing of contracts (and overages), JUMP!, international fees waived, Data Stash, Music Freedom and Binge On. All commendable moves if taken on their own. But when you start putting them together, are they so helpful? Yes, you no longer pay overage charges, but with the ability to whitelist music and video, are you likely to incur any overages. Not to mention, the ability to roll over your data (which is also being doubled) also counts against any overage charges, video or music streaming. In fact, with the whitelisting of the two most data demanding services (music and video), do you need to stockpile data at all? What use will it be to you? Of course, Legere will tell you it is “your data” so you should keep it. But not forever, just for a year, just long enough so that they can say they give you your data. When in fact, it does have an expiry date. Not to mention, you are not allowed to stash any more than 20GB….of your data.

So although, all these moves make sense on an individual level, they seem to lack a coherent and substantial thread of change. They are all just more sides of the same coin. Another way to sell you the same thing, data. This is the carrier’s golden ticket and being very carrier-like, T-Mobile are highly focused on generating the headlines which lead to the assumption they are different. They are offering you all these ways to cut your data expenditure, but none drastically differ from each other. Where is the real change, the real uncarrier moves, the real revolution?

T-Mobile are making some changes and they are improving the industry, however, they are not doing this for the noble reasons or to the degree that T-Mobile often portrays. The company under Legere is anything other than an uncarrier. In truth, they are not that much different to dumb and dumber at the core level. What they care about is subscribers, numbers, profit and being the number one carrier in the U.S. T-Mobile (Legere) may reply to a tweet you send, may reference you at the next uncarrier event and may make you feel like there is a momentum with magenta. But it is always worth remembering, the dramatics, the profanities, the theater, that is about catching your attention, making you aware of who they are and maybe even consider swapping to them. It is the consumers they are placating, not the market.