Even Though Verizon Tried Its Best To Keep Me, I Still Switched To T-Mobile Because It's A Better Deal

CEO John Legere t-mobileReutersT-Mobile CEO John Legere.

At the Consumer Electronics Show last week, T-Mobile made me an offer I couldn’t refuse.

This past weekend, I took them up on it. I canceled my Verizon contract and switched to T-Mobile.

In case you missed last week’s news, T-Mobile will now pay the Early Termination Fee (ETF) carriers charge you for cancelling your contract early. Depending on how deep you are into your contract, that fee could could be several hundred dollars. T-Mobile also requires you to trade in your old smartphone, and you can apply its value to your bill, a new phone, or get a prepaid MasterCard.

But first, I wanted to see what Verizon had to say.

Verizon’s counteroffer

As I wrote last week, it makes financial sense for me to make the switch. Verizon charged me $US110 per month for 2 GB of data and unlimited calling/texting. If I went over that 2 GB (as I sometimes did), Verizon automatically charged me $US15 for an additional 1 GB of data. Unfortunately, that overage charge would always come at the end of my billing period and I never had a chance to use much of the extra GB. Instead, Verizon basically got a free $US15 from me.

Before I made the switch though, I wanted to see if Verizon had a counteroffer. I tweeted a lot last week about my intention to ditch Verizon. Eventually, its Twitter support staff caught wind and sent me a few messages asking if there was anything they could do to keep me. Then they realised I was a journalist who wrote a very public post about why I was switching. Then the public relations team got involved. Then I talked to a salesperson.

(Full disclosure: I made it clear beforehand that I didn’t want any special treatment because I’m a tech journalist. I told Verizon’s PR team that I didn’t want them to offer me any incentive to remain a customer that they wouldn’t offer other customers. I also told them any conversation I had with a service representative would be on the record and that I’d write about any offer they gave me. Verizon agreed.)

The Verizon salesperson made me an offer for something called the “Smartphone Loyalty Plan,” which was about $US40 cheaper than what I was already paying. That would put the plan at about the same price as the $US60 T-Mobile plan I had planned to switch to.

Verizon doesn’t publicize its Smartphone Loyalty Plan. Instead, it’s a weapon Verizon can use to keep customers in good standing on the network. Since I had been with Verizon for over a year and always paid my bill on time, Verizon made me the offer. The sales rep also told me Verizon will sometimes offer a free Android smartphone to convince customers to stay.

But there were some caveats. First of all, the Smartphone Loyalty Plan doesn’t let you use your smartphone as a hotspot. You have to pay extra for that. Next, the Verizon rep I’d have to sign a one-year contract if I wanted to take the offer. And finally, Verizon would still slap me with a $US15 charge if I went over my 2 GB of data.

And that’s what bothered me. Yes, my monthly bill would be a bit cheaper, but I’d still be locked into a contract with Verizon. I also wouldn’t have the opportunity to use my phone as a hotspot if I wanted to. (That’s another bothersome thing about carriers. Even though you pay for a certain amount of data per month, they can still dictate how you use it. Annoying.)

With T-Mobile, I was going to pay $US60 for 2.5 GB of data and unlimited calling/texting. If I went over that 2.5 GB, T-Mobile wouldn’t charge me, just slow down my Internet speeds a bit until the next billing cycle began. That’s something I can live with. Plus, T-Mobile doesn’t force you into a contract or smartphone upgrade cycle, so I knew I could get an iPhone 5S and sell it on Craigslist this fall when I’m ready to upgrade to Apple’s next iPhone.

I politely declined Verizon’s offer and headed to T-Mobile.

What it’s like to switch to T-Mobile

It’s easy.

On Sunday, I walked into a T-Mobile retail store in Manhattan and told the sales representative I wanted to switch over from Verizon. The sales rep knew exactly what to do and started right away with all the necessary paperwork. I gave him my Verizon cell phone number that I wanted to port over to T-Mobile, my Verizon account number, and my old phone. He took care of the rest.

First, he asses ed the value of my old iPhone. I had a 32 GB iPhone 5, which T-Mobile’s system said was worth $US214 (!), even with a few scratches. (T-Mobile won’t accept phones that are cracked, chipped, or nonfunctional.) Next, I picked my plan. As I said above, I decided on the $US60 plan for 2.5 GB of data per month plus unlimited calling/texting. Finally, I chose a phone. I realised I was barely using any space on my 32 GB iPhone, so I decided to go with a gold 16 GB iPhone 5S.

Then came the credit check. Since I have good credit, I was able to get the iPhone 5S for $US0 down plus $US25 per month until the phone is paid off in 24 months. (I always have the option to go ahead and pay off the full $US600 cost of the phone whenever I want to, which is what I’ll do when I’m ready to upgrade to Apple’s next iPhone later this year.) I did have to pay sales tax on the full value of the phone up front, which came to about $US60. But here’s the good news: Since T-Mobile was willing to pay me $US214 for my old phone, I walked out of the store that day having paid $US0. In fact, T-Mobile still owes me money, and the remaining balance will be applied to my future bills.

Finally, I had to break up with Verizon. When the T-Mobile rep punched my Verizon phone number and account number into the computer, my Verizon plan was automatically canceled. I never had to talk to someone at Verizon to close out my account. My original number immediately transferred to my new T-Mobile phone. A few hours later, I got a text message confirming my Verizon account was closed.

It’s not over yet though. Verizon will soon send me a bill with my Early Termination Fee that I’m contractually obligated to pay. (I don’t know how much it’ll be, but it shouldn’t be too bad since I only have about 6 months left in my contract.) After I pay Verizon’s ETF, I then send the bill to T-Mobile through its website. T-Mobile will verify everything and reimburse me with a prepaid MasterCard six to eight weeks later.

That’s it. I now have a brand new iPhone 5S. I don’t have a contract. I’m paying about $US20 less per month than I was on Verizon.

I spent $US0 Sunday to get all this, and I’ll be saving even more money on my monthly bill in the long run.

I win.

By the way, the sales reps at T-Mobile were insanely polite, helpful, and professional. I was impressed. The man who helped me even gave me his business card and said I could call him whenever I wanted if I had any problems with my account. I haven’t experienced that level of customer service in a retail store other than the Apple Store.

So, how’s the network?

I’ve been using T-Mobile for less than 24 hours, so it’s impossible for me to give you an accurate assessment of the network here in New York. I can tell you that I performed a few speed tests using an app called Ookla and recorded download speeds that are just as fast, if not faster, than what I got through Verizon. I’ve made two calls so far and quality was great.

Not everyone should make the switch

While it made financial sense for me, there’s a chance you’re not paying as much for your Verizon, Sprint, or AT&T plan as I was. I signed up as a new Verizon customer about a year and a half ago, so I had no choice but to use one if its newer shared data plans. Those plans are very expensive, which is why I was paying $US110 per month for my 2 GB data plan and unlimited calling/texting. If you’ve been with your carrier for several years, you’re probably not paying as much as I was. In fact, there’s even a chance you’re “grandfathered” into your old unlimited data plan, so you don’t even have to worry about overage charges.

Then there’s the issue of coverage. Yes, T-Mobile is cheaper, but its coverage is nowhere near as robust as what you can get with Verizon or AT&T. T-Mobile’s LTE network, the fastest wireless Internet standard available, is tiny compared to Verizon and AT&T’s. Luckily, I live in New York, which has excellent T-Mobile LTE coverage.

In short, you have to look at what you’re paying now and ask yourself whether or not you’re happy with your coverage. Yes, there’s a strong chance you’ll save money. Yes, T-Mobile makes it incredibly easy to switch. But if you live in a city that doesn’t have strong coverage from T-Mobile (you can check here), it’s probably not worth switching for sub-par coverage, even if you do end up saving money.

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