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T-Mobile stops overage fees, starts petition pressuring other carriers to follow suit

Caitlin McGarry | April 16, 2014
Most of us have been hit with overage charges at one point or another in our smartphone-owning years. It hurts. The penalties for exceeding your allotted monthly data, texts, or voice minutes can be outrageous. So T-Mobile capped off its week-long spate of Uncarrier announcements with a new campaign to abolish the industry-wide practice of overage charges.

Most of us have been hit with overage charges at one point or another in our smartphone-owning years. It hurts. The penalties for exceeding your allotted monthly data, texts, or voice minutes can be outrageous. So T-Mobile capped off its week-long spate of Uncarrier announcements with a new campaign to abolish the industry-wide practice of overage charges.

T-Mobile CEO John Legere started a petition Monday to force his company's competitors, AT&T, Verizon, and Sprint, to eliminate overage penalties altogether. T-Mobile customers on any consumer plans will no longer see penalties for going over their monthly limits.

This doesn't mean that T-Mobile will be giving away data for free. It's just not going to hit you with nasty upcharges. On the Simple Choice plan, for example, users have never had data-overage penalties. If they hit their limit on 4G LTE data, T-Mobile simply dropped their data speed to 2G until the end of the billing period. Now, all of T-Mobile's plans will have some alternative to overage fees.

In his petition, Legere cites two astonishing figures: 20 million Americans had to pay for overages last year to the tune of $1 billion. If Legere can convince some of those people to switch to T-Mobile, the company could jump from its current fourth-place postion, lagging behind AT&T, Verizon, and Sprint. T-Mobile added 4.4 million subscribers last year and hopes to add 2 to 3 million more people this year.

The overage penalty petition is the latest in a series of T-Mobile moves over the last few days. On April 12, the company introduced a new $40 Simple Starter plan with unlimited talk and text and 500MB of LTE data. If you hit your limit on this plan, you won't pay an overage fee; instead, you have the option to buy more data.

The Simple Starter announcement was followed by a tablet deal: T-Mobile now offers 4G LTE tablets for the same price as Wi-Fi versions, and is throwing in an extra 1GB of free data for the year.

T-Mobile took a break from Uncarrier news on Friday to start selling the Samsung Galaxy S5 and HTC One (M8).

Monday's petition is business as usual for Legere, who is making a name for himself as the People's CEO. It's a role he clearly relishes, as he regularly pokes T-Mobile's rivals with both official announcements and a stream of teasing tweets.

"Imagine the smile on my face as I watch millions upon millions of Americans flipping the bird to the insanity and pain of the past and joining this consumer revolution — while I sit back and watch the competition flounder," Legere said in a Monday statement announcing the overage elimination initiative.

 

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