T-Mobile (NASDAQ:TMUS) wants you to cross the border and never look back. This week, the company announced its latest Uncarrier initiative, called Mobile Without Borders, which allows both T-Mobile Simple Choice prepaid and postpaid customers to use their phones and plans in both Mexico and Canada without any roaming charges or additional fees.
Just as the name suggests, T-Mobile essentially removed the virtual borders for its customers starting July 15, so that they can use their phones to call landlines and cell phones, send and receive text messages, and use 4G LTE data anywhere on the continent without paying a dime above their current plan.
The move is yet another perk added to a long list of freebies T-Mobile gives to its customers -- but the real purpose of Mobile Without Borders is to set T-Mobile further apart from rival AT&T (NYSE:T).
Outpacing AT&T's promises
T-Mobile CEO John Legere said in a press release that the company is the first and only carrier to offer a plan like this, despite AT&T's talk on bringing a more unified cellular network into Mexico.
"After spending billions buying up Mexican telecoms, AT&T's CEO is promising 'the first seamless network covering Mexico and the U.S.,' something 'unique' that 'nobody else will be able to do for the consumer.' So much for that. They won't be the first. And they won't offer Canada for free," he said. Legere is referring to AT&T's purchase of Iusacell and Nextel Mexico earlier this year in an effort to launch a "North American Mobile Service Area."
AT&T's plan won't be fully realized for a while, and it doesn't include Canada. Meanwhile, T-Mobile has struck deals with Mexican and Canadian carriers to bring about its own cross-border network now.
While it's easy to question how often T-Mobile's customers will actually use the new service (I know I initially did), Legere said that last year 35% of all international calls and 55% of international travel from the U.S. were to Mexico and Canada. And long-distance calls from U.S. wireless customers to Mexico and Canada totaled about 25 billion minutes last year. All this means is that Mobile Without Borders could be a big benefit for current T-Mobile customers, and an incentive for those looking for a new wireless provider.
Uncarrier events are undeniably paying off
While Mobile Without Borders won't directly add any revenue to T-Mobile's bottom line (because, well, it's not charging anything for it), it's likely still a smart move for the carrier.
The company's slew of Uncarrier offerings over the past few years has certainly paid off, as evidenced yet again by its quarterly subscription numbers. T-Mobile released its Q2 2015 numbers this week, and it added 2.1 million net customers, which marks the carrier's ninth consecutive quarter of net additions over 1 million.
At some point, T-Mobile will have to come to terms with the fact that it can't keep handing out free services to customers without raising prices, but for now, it is still focusing on building out its customer base and challenging the leading carriers -- and in that mission, T-Mobile appears unstoppable.