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T-Mobile USA earns highest satisfaction ratings…so why can’t they attract more customers?

March 4, 2010 | by Andrew Kameka

Featured post, T-Mobile

T-Mobile USA earns highest satisfaction ratings…so why can’t they attract more customers?

T-Mobile USA has received the highest ranking in the J.D. Power and Associates 2010 Wireless Retail Sales Satisfaction Study – Volume 1. T-Mobile earned the highest score for customer satisfaction among U.S. carriers, the 8th time in 11 volumes that Magenta has come out on top.

If T-Mobile is so great, what’s causing them to continuously lose out in the customer race to AT&T and Verizon? Despite earning the highest marks for a competent sales staff and favorable prices, T-Mobile ranks last among the four major carriers when it comes to subscriber totals. The company did increase to 33.8 million customers in 2009, up from 32.8 million a year ago, but much of that comes from prepaid customers. T-Mobile actually lost 117,000 net contract customers in the last three months of 2009.

One would think that having the most satisfied customers would lead to a better position in the cellular phone market; however, T-Mobile has three major problems holding them back

  • Carrier awareness and lack of advertising
  • Lack of easily-accessible, next-generation smartphones
  • There’s a Map for them, too

Carrier awareness and lack of advertising

I can’t turn on my TV without seeing Owen Wilson peddling AT&T or Verizon advertising their latest phone and telling everyone they have a superior network. I can count the number of times I’ve seen a T-Mobile commercial in the past week on one hand. When you have two networks bombing the airwaves touting their virtues, it creates a brand recognition and enticement that T-Mobile simply can’t match. It’s tougher for them to draw new customers when faced with this situation.

Lack of easily-accessible, next generation smartphones

T-Mobile has done an incredible job of embracing Android, but they’ve moved backwards. They keep running back to the myTouch well and bringing on phones that are already out-dated before they even hit the store shelves. When it’s time for someone to pick a new smartphone, the CLIQ XT or Behold II simply cannot stand up to the iPhone or Droid if you’re looking for one of the most powerful devices on the market.

The Nexus One might help T-Mobile attract some new customers, but it will be hard to hold on to some current subscribers because many aren’t eligible for an upgrade. T-Mobile told me I can get an early upgrade but they won’t let me apply it to the N1, which costs more than $500 when purchased by itself. It would actually be cheaper for me to just wait on the Supersonic/Desire/Incredible and pay the higher costs of 2 years on a Verizon contract.

There’s a Map for them, too

While it’s easy to laugh at AT&T’s spotty 3G coverage, T-Mobile hasn’t had any 3G coverage in several places for quite some time. I didn’t get 3G in Miami until late 2008, and there are many places in the US that still lack coverage or have data speeds that cannot compete with the other companies. Is there truth to you get what you pay for? Perhaps. Maybe the HSPA+ upgrade will make T-Mobile more attractive and faster than its competitors.

Conclusion

I have been with T-Mobile since 2007 and it’s been the best contract experience I’ve had. The prices have always been the best, I have 3G in my home market and most cities I travel, and I’ve been relatively happy with my G1 for most of that time. However, I’m not sure if I will be on T-Mobile’s subscriber rolls come 2011. The company won’t let me use my upgrade towards a Nexus One and it doesn’t seem like they will get a legit Android superphone other than the unique Nexus One. Data speeds are also inferior to Sprint and Verizon in my market.

Customer service and fair prices go a long way, but day-to-day advantages will always trump that (at least for me). A speedy HSPA+ rollout in my city might convince me to stick around and renew my contract, but nice sales people isn’t going to keep me loyal to T-Mobile. Quarterly reports and T-Mo’s stellar performance in J.D. Power and Associates’ surveys show that I’m not the only one who feels that way.