T-Mobile (sort of) eliminates employer discounts, tries to spin it as a good thing

[Shawn Knight]

Update: T-Mobile has had a change of heart with regard to the elimination of employer discounts. In a blog post penned earlier today, CEO John Legere said he’s been doing a lot of listening to customers and has decided to update the implementation plan for the changes announced a few days ago.

As such, anyone that was enrolled in the employer discount program or who applied to enroll before April 1 will be able to retain the rate plan discount so long as they continue to work at a participating employer. All that they are asking is for customers to participate in an annual online employer verification process.

New customers that sign up for employer plans after the April 1 deadline will only qualify for the $25 reward card as per the story below.

Original story below

T-Mobile CEO John Legere on Monday revealed the latest step in his company’s Un-carrier approach – eliminating employer rate plan discounts. The outspoken executive noted previous programs were designed to help big carriers close big corporate contracts by using employees as bargaining chips.

T-Mobile isn’t playing that game any longer.

Instead, the wireless carrier will offer a $25 reward card each time an employee purchases a new device. For a family of four that upgrades once a year, that’s up to $100 off (or $200 off if they upgrade twice annually).

Legere said the change is about simplifying wireless for everyone which includes employees of small and large companies alike. True enough, it’s easier to calculate a $25 per device upgrade savings versus a percentage off of a wireless bill each month… but let’s not kid ourselves here.

Despite the spin that Legere put on the message, the only entity that really wins here is T-Mobile. For better or for worse, the change is still based on where you work – just as before. A $25 discount on a phone upgrade is a far cry from, say, a 15 percent monthly discount on wireless service and only applies if you upgrade your phone. Those that rarely upgrade are essentially left out in the cold.

There’s no doubt that T-Mobile will earn some extra revenue from not having to discount so many plans but the question is, will they use that money to fund better deals for customers down the road?

Permalink to story.

https://www.techspot.com/news/56208-t-mobile-sort-of-eliminates-employer-discounts-tries-to-spin-it-as-a-good-thing.html

 

[Guest]

T-Mobile continues to jerk everyone's chain so that its CEO can get a bigger bonus at year-end.

The Association I'm a member of was thrown to the wolves by T-Mobile in that T-Mobile sent a stone cold letter to it stating it had decided its business strategy had changed whereby no more discounts to association members would be honored - nor would member's be allowed to continue to receive any continued discount from T-Mobile. The association wrote the CEO of T-Mobile a note, saying "AT&T welcomes 20K members with open arms so all of our members are switching immediately and leaving T-Mobile for AT&T Wireless (a carrier which honors its commitments).

T-Mobile's business practices has come unstable, unreliable and the company seems to have lost its identity and direction. AT&T is matching T-Mobile basically, and we are getting much better coverage in areas where T-Mobile never could touch. Bye-Bye-T-Mobile....

 

[Jad Chaar]

Wow $25 only. That sucks.

 

[MilwaukeeMike]

True enough, it’s easier to calculate a $25 per device upgrade savings versus a percentage off of a wireless bill each month… but let’s not kid ourselves here.

True. Let's not kid ourselves. So we should also discuss how that monthly discount is applied. I used to get a 12% discount a while back from an employer and I thought, hey that's pretty good... until my bill came and I saw how they did the math.

What they do is take 12% off your monthly base plan not your whole bill. So if your plan is $50/month, that's $6 off. But.... they take it off before they add in all the extras. So your bill looks like this.
Plan - $50
Discount - ($6)
Misc charges - $10
State Tax - $3
Federal tax - $2
Tax so poor people can get free phones - $1
Fee because your phone is black - $1
Long distance calls - $15
Total - $76

So now that $6 off is really off of an otherwise $82 bill and it's only about a 7% discount. Now, I admit, I MAY have made up a few of those fees (perhaps), but I left off the $20/month you'd have if you had T-mobile and were paying off a premium smartphone. The point is, the discount is off the base of the plan and excludes any extra charges or fees or taxes.

I don't think anyone with T-mo is complaining out the bill. They complain about the coverage. The bill is the cheapest from any carrier.

 

[khha4113]

True enough, it’s easier to calculate a $25 per device upgrade savings versus a percentage off of a wireless bill each month… but let’s not kid ourselves here.

True. Let's not kid ourselves. So we should also discuss how that monthly discount is applied. I used to get a 12% discount a while back from an employer and I thought, hey that's pretty good... until my bill came and I saw how they did the math.

What they do is take 12% off your monthly base plan not your whole bill. So if your plan is $50/month, that's $6 off. But.... they take it off before they add in all the extras. So your bill looks like this.
Plan - $50
Discount - ($6)
Misc charges - $10
State Tax - $3
Federal tax - $2
Tax so poor people can get free phones - $1
Fee because your phone is black - $1
Long distance calls - $15
Total - $76

So now that $6 off is really off of an otherwise $82 bill and it's only about a 7% discount. Now, I admit, I MAY have made up a few of those fees (perhaps), but I left off the $20/month you'd have if you had T-mobile and were paying off a premium smartphone. The point is, the discount is off the base of the plan and excludes any extra charges or fees or taxes.

I don't think anyone with T-mo is complaining out the bill. They complain about the coverage. The bill is the cheapest from any carrier.

It's same thing to AT&T. They only discount the first line on my family plan before tax and fee.

 

[mctommy]

The problem is the rampant abuse of these corporate discounts across all major carriers and even more so with tmobile.

When I was with AT&T, the discount my wife's company had with AT&T was 24% but in the end, it was really just a discount of $30 bringing the price for 3 lines (2 data) from $195 down to $166. When she left the company, we still kept the discount because AT&T never did yearly employer qualification check.

As for tmobile, lots of people were able to find store employees to apply discounts that they didn't qualify for (didn't work there) to drive their sales and commission. Just like AT&T, they don't bother to check either.

I think they will probably bring the corporate discount back but they will take it away from the store employees and drive it through their website and close any loopholes.

 

[Skidmarksdeluxe]

It sounds too complicated as far as I'm concerned. I'll just stick with prepaid and buy my carrier unlocked phones cash.

 

[nazartp]

Well, after being T-Mobile customer for the last 10 years I expect to switch to a different carrier when the new phone upgrade is due. Quite sure the firm I work for will dump them pretty quickly - my employer picks up 100% of business phone plan cost. We employ 100k people, if only 20% of the employees have T-Mobile, it's 20k people that will switch to other carriers. I seriously doubt that the difference between the discount they offer and single time $25 will cover the loss of revenue of such magnitude.

 

[mctommy]

Well, after being T-Mobile customer for the last 10 years I expect to switch to a different carrier when the new phone upgrade is due. Quite sure the firm I work for will dump them pretty quickly - my employer picks up 100% of business phone plan cost. We employ 100k people, if only 20% of the employees have T-Mobile, it's 20k people that will switch to other carriers. I seriously doubt that the difference between the discount they offer and single time $25 will cover the loss of revenue of such magnitude.

Corporate discounts and b2b are two different things. Corporate discounts are more done as a courtesy/incentive for employees of a company/association/government. B2B is for companies that provide people with work phones with mins and data paid for the company in bulk.

While they may discontinue the corporate discount, the B2B is still there and likely on contract for the company as a whole.

 

[ibenzawla]

Same thing with Verizon if not worst. I was excited to finally try Verizon since I have a cool 25% discount with my place of work thinking that with such a discount my bill would be about the same as their cheaper rivals. But then my bill came and I realized that the discount is only for the data not the entire bill. And somehow their tax and fees is about $12 a month. So I did the math and after about two months I decided to switch to Tmobile and get a cool Lumia 521 that I bought for $100. By the way they paid my ETF as well. "Mileage" may very though so be careful.