T-Mobile’s outspoken CEO is on a public campaign that continues to poke a stick at his largest rivals as a key government spectrum auction shapes up for next year.
“Don’t let the evil duopoly take control of your mobile Internet!”
That’s a piece of the blunt advice T-Mobile US Chief Executive John Legere is spreading via Twitter in his latest fight with Verizon Communications and AT&T, also known as “Dumb and Dumber” in his lexicon.
With tweets and an online cartoon video showing him fighting a two-headed pinstriped executive bent on seizing airwaves, Legere portrays himself as a superhero to claim a larger share in a government spectrum auction next year.
Whether he can win is in doubt, because a top regulator Thursday recommended denying T-Mobile’s request for help getting more airwaves. Still, the effort may aid Legere’s broader mission.
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“Even if the cause is lost, this campaign is a really inexpensive way to reinforce the T-Mobile brand, and he does it well,” said analyst Maribel Lopez, founder of Lopez Research.
Legere is using aggressive promotions and price cuts to add customers. Thursday he unveiled the latest — JUMP! On Demand, a new version of T-Mobile’s JUMP program launched in July 2013.
T-Mobile has indicated it will upgrade more of these so-called “Un-Carrier” moves in the next few weeks in an effort it calls “Un-Carrier Amped.”
JUMP! On Demand gives customers the option to lease a smartphone and upgrade to a new one whenever they want — up to three times a year.
Legere wants to build on momentum from the promotions by improving T-Mobile’s network. He has his eye on the 2016 auction, which offers a trove of low-band airwaves that travel far and through buildings.
Verizon and AT&T, the largest carriers, already control about 70 percent of that airwaves type. To make sure their big checkbooks don’t vanquish all other bidders, the Federal Communications Commission has already reserved some spectrum for smaller providers.
Legere wants a bigger share set aside for the smaller operators — roughly defined as any company besides AT&T or Verizon.
FCC Chairman Tom Wheeler, in his recommendation, said additional set-asides aren’t necessary. The current reserve “balances the desire to make low-band spectrum available to parties with limited holdings while facilitating competitive bidding for all auction participants,” he said in a blog post.
Wheeler needs to win a vote at the five-member agency where he leads the Democratic majority.
“Magenta Herring”
The larger carriers responded to Legere’s campaign. AT&T titled its rebuttal “Magenta Herring” in reference to the company’s identifying color. Verizon appealed to Legere’s sensibility in its reply, “Watch the Language.”
AT&T said in a June 15 blog posting that the reserve request is “about protecting T-Mobile from competitive bidding.”
On June 11, Verizon wrote on its blog that it’s “bad policy” and “Mr. Legere and T-Mobile are actually doing whatever they can to push companies like Verizon out of the auction.”
Legere isn’t backing down. He says T-Mobile’s ability to compete hinges on airwaves, and he’s framed the argument as good vs. evil in his rowdy-populist rebel style on social media.
“This is an interesting case to see if they can call on growing consumer loyalty and translate that into political action,” said Harold Feld, senior vice president at the policy group Public Knowledge.
The Justice Department supports the FCC’s decision to create a reserve to give smaller carriers “a meaningful opportunity” for airwaves needed to compete, Assistant Attorney General William Baer said in a letter Wednesday to the FCC.
Nothing is over until the last vote is cast and Legere isn’t giving up, said Andy Levin, T-Mobile’s senior vice president of government affairs.
“He is by far the best advocate we have in Washington,” Levin said.
T-Mobile has challenged the industry with sales tactics like phone financing, data rollovers, price cuts, free music streaming and Thursday’s JUMP! On Demand.
The self-branded un-carrier theme has caught on with consumers. The company added 4 million monthly phone subscribers last year, more than all the other carriers combined.
The FCC plans to sell airwaves voluntarily given up by television stations so the frequencies can be used to accommodate the growing number of smartphones, tablets and other wireless-data devices.
T-Mobile is asking Wheeler to enlarge a reserve he established last year over opposition from Republicans, who said the FCC was attempting to pick winners and losers in the auction.
Having some airwaves reserved “is a revolutionary decision that this commission has already made,” Wheeler said when asked about T-Mobile’s request in a June 18 news conference.
Sprint, the third-largest U.S. wireless carrier, said in a filing to the FCC that it supports T-Mobile’s request, partly because the two largest carriers can outbid others for any frequencies not reserved to promote competition.
Legere’s make-yourselves-heard plea has registered with some of his followers. The FCC has received more than 3,800 comments about T-Mobile’s request in the past two weeks compared with about 700 in the preceding six months, according to the agency’s website.
“Even in defeat he will have accomplished his mission to build a groundswell of consumer support,” said Roger Entner, an analyst with Recon Analytics in Dedham, Mass. “He’s positioned himself as the underdog and the whole world is against him. This just reinforces that story.”