Technology
The New iPhone Has Carriers Hustling for Customers
Phil Schiller, Apple’s senior vice president of worldwide product marketing, discusses the new iPhone 6, center, and iPhone 6 plus, right, on Tuesday (AP Photo)
(Business Week) – The new iPhones are almost here, and your wireless carrier is feeling excited and insecure. Carriers began maneuvering for position as soon as Apple announced its new devices. Their intensity reflects a new reality in the wireless industry: There are fewer tricks to keep customers locked into their networks, inspiring companies to compete in new ways.
On Wednesday, T-Mobile (TMUS) announced it would expand Wi-Fi calling to the new iPhone. It isn’t new, but T-Mobile is the only carrier that will let people make calls over Wi-Fi on Apple’s (AAPL) new phones. The company also says it will allow anyone to trade in phones for a Wi-Fi-enabled device, so long as they join the company’s $10-a-month upgrade program. Now T-Mobile will be able to claim that it provides service in places no one else can, while also plugging holes where its network isn’t as strong as the competition’s.
This may not be persuasive—and if it isn’t, it will partially be T-Mobile’s own doing. The major carriers today don’t compete much on network quality, because with the exception of Sprint (S), they’re all basically good enough. Now they compete on price, a trend T-Mobile started last year. At the time, it needed a way to lure people from AT&T (T) and Verizon Wireless (VZ), whose networks had better reputations. It has been far and away the most successful at adding customers in the time since, inspiring the entire industry to shift away from subsidized phones with two-year commitments.
