T-Mobile (NASDAQ:TMUS), as a company, tends to take on the personality of its outspoken CEO, John Legere. That's a good thing as the company does battle with bigger rivals, including Verizon (NYSE:VZ), which has generally used a marketing plan that clearly proclaims "we're the best," as a justification for higher prices.
With its "better matters" ads, along with its misleading presentation of the latest RootMetrics Mobile Network Performance in the U.S. report in its commercial that says T-Mobile is "a better network as explained by colorful balls," the company wants to assert its superiority by using selective facts along with sheer force of will. (For a critique of the "balls" commercial, see "Here's Why Verizon's 'Better Matters' Ad Is Not Telling the Full Story.")
Legere is not someone you want to go after with claims that don't quite pass the sniff test. He's the one who walks up to the toughest guy in the prison yard and socks him in the mouth -- not to look tough, crazy, or gutsy, but to show that he's at least an equal, if not a better.
And that's exactly what Legere and T-Mobile are doing with their latest promotion, #BallBusterChallenge, walking up to the biggest and toughest-seeming wireless company, socking it in the mouth, and daring it to punch back. It's a bold strategy that only works if T-Mobile can actually deliver the goods.
What is T-Mobile saying?
The company is directly challenging Verizon's best network claims by saying that the results it shows in the "colorful balls" ad are old and misleading. T-Mobile, in a press release, noted that "pop-ups in the ad call out the missing details and facts, including the fine print" that the Verizon test is up to 12 months old. Legere's company also noted that the ad ignores that T-Mobile's LTE network has doubled in size in the past 12 months.
"Verizon is known for their network coverage ... so when they suddenly start spending tens of millions in ads to try and convince people their network's better, it says a lot," Legere said. "Verizon's so nervous they're willing to use old, incomplete data about our network on TV! But they've got good reason to panic; more than 5 million Verizon customers switched to T-Mobile in the last two years, and now, we're going to show everyone else how the two networks really stack up."
How will T-Mobile do that?
In typical brazen T-Mobile style, Legere and company have introduced #BallBusterChallenge, an invitation to Verizon customers to "take the challenge and see T-Mobile's rapidly expanding network in action side by side with Verizon." T-Mobile will use its challenge to compare its network to Verizon's. The company laid out its plans in the press release:
The Challenge will travel across the country to cities large and small to challenge Verizon's network head on, testing data speeds, texting, and calls. If Verizon's network wins over T-Mobile two out of three times, their customer walks away with a $100 Visa Prepaid Card courtesy of T-Mobile. And if they lose, they'll pose for a photo with a sign of their choice, with options like "T-Mobile's network just schooled Verizon #BallBusterChallenge," and "T-Mobile's network was just as good as Verizon's #BallBusterChallenge," and "Verizon's network just got spanked by T-Mobile #BallBusterChallenge."
It's a bold bit of gamesmanship by Legere's team, but it's also worth noting that the setup allows T-Mobile to stack the deck in its favor. The company knows where its network performs well, and it's almost certain the challenge will only travel to those areas. This isn't a random caravan; it's cleverly orchestrated showmanship designed to tilt in T-Mobile's favor.
But while the public-facing side of the challenge is more theater than true test, a second piece of it is not. T-Mobile has made an open offer to all legitimate media to send them the smartphone of their choice with free T-Mobile service for three months so they can test the network. And for a true side-by-side comparison, the carrier has also offered to equip journalists with a Verizon-enabled phone.
This is a bold move
T-Mobile has invested heavily in its network and has largely narrowed, if not eliminated, the gap with Verizon. Simply offering this challenge shows that it's willing to be compared against its rival.
And while the consumer piece is a bit rigged, the journalist side is not. Ultimately, putting T-Mobile and Verizon phones in the hands of media will show exactly how the two companies stack up. That may still result in a small win for Verizon, but it could go a long way toward proving that there's now very little difference between the two companies' networks, as T-Mobile contends.
Daniel Kline has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.