The cell phone industry is ripe for reform, but who expected changes to come within its own ranks? T-Mobile has won over customers by offering free international roaming, no contracts, 200 MB of free data on tablets, and faster times between phone upgrades–that is, by trying to be customer friendly.
T-Mobile CEO John Legere is leading this public campaign, and his antics haven’t been pretty–or particularly dignified. Early last year, he unleashed a profanity-laced diatribe against the wireless industry, railing against practices such as locking customers into a contract. His latest salvo against AT&T, in January, included a press release that compared the wireless giant to Darth Vader and included fake quotes from AT&T’s CEO. It was an Onion-like mocking of policy changes that followed T-Mobile’s lead.
Nonetheless, T-Mobile’s unorthodox strategy is working, helping to stem 16 consecutive quarters of subscriber losses at the nation’s fourth-largest carrier. In the six months that followed Legere’s diatribe, T-Mobile added 1.4 million long-term subscribers, more than AT&T and Sprint. From May to December, its market value increased by more than 100%, and the company became the subject of feverish acquisition rumors.
At about the same time that Legere assumed his bad-boy persona, he also changed T-Mobile’s compensation structure to give every worker an equity stake in the company.