AT&T ends $450 promotion aimed at wooing T-Mobile customers, cuts Aio prices

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AT&T Mobility (NYSE:T) ended a month-long promotion aimed at getting T-Mobile US (NYSE:TMUS) customers to switch over by offering them up to $450 in credit. Although AT&T has dropped the promotion, which was only a short-term deal, it has since cut its pricing for high-end family data plans and also launched another promotion aimed at getting customers to sign up for a new line of service.

The T-Mobile-focused promotion started Jan. 3 and ended Jan. 31. An AT&T spokesman pointed out that, when AT&T first launched the promotion, it said it would be for a limited time only.

Under the promotion, AT&T gave T-Mobile customers $200 in credit per line when they switched to AT&T and chose an AT&T Next device financing plan, bought a device at full retail price or activated a device they currently own. Additionally, AT&T offered T-Mobile customers who switched the ability to trade in their current smartphone for a promotion card worth up to $250, which could be used toward AT&T products and services.

T-Mobile executives took to Twitter to point out that the promotion had ended. T-Mobile CMO Mike Sievert tweeted: "@ATT calls it quits early on their so-called $450 @TMobile switcher offer! Nice try but customers aren't fooled by your #SmokeAndMirrors."

T-Mobile CEO John Legere, ever eager to tweak his rivals, chimed in: "That was quick! @ATT already revoking the $450 bribe to @TMobile customers? People weren't falling for it, were they #Randall#doingitwrong."

T-Mobile has announced it will pay up to $650 in early termination fees (ETFs) for customers who want to switch to T-Mobile from other carriers and trade in their devices. That offering is not a promotion.

AT&T now has a new promotion that runs through March 31, in which it is giving $100 in credit to new and existing customers who open a new line of service for each new smartphone, tablet, feature phone, mobile hotspot or Wireless Home Phone they add.

Further, AT&T yesterday cut prices on its higher-end Mobile Share shared data plans. AT&T said customers who choose a Mobile Share plan with 10 GB of data per month or higher will see a range of savings, depending upon their existing plans. For example, customers who sign up for four smartphones with unlimited voice, texting and 10 GB of data will now pay $160 per month, or $40 less than AT&T's old plan at that level. Analysts see the changes as both a response to T-Mobile and as a way to hit rival Verizon Wireless (NYSE:VZ) and its family plans.

Separately, AT&T's prepaid brand Aio Wireless is cutting prices. The change is odd since AT&T plans to soon discontinue the Aio brand following the closing of its deal for Cricket provider Leap Wireless (NASDAQ:LEAP), which is expected before the end of the first quarter.

Aio's new plans include a $40 plan for unlimited voice, texting and 500 MB of data before throttling, compared to an old $40 plan that had 250 MB of data before throttling. The $40 plan now supports smartphones, whereas it did not before. Aio's new $50 plan includes unlimited voice, texting and 2.5 GB of data, compared to an old $55 plan that had 2 GB of data. And Aio's new $60 plan includes unlimited voice, texting and 5 GB of data, compared to an old $70 plan that had 7 GB of data.

Meanwhile, shares in all four U.S. wireless carriers fell on Monday as investors worry that AT&T's price cut on its Mobile Share plans will lead to a price war and lower profits. "Now we're seeing real evidence of increasing competition having real cost to the industry," New Street Research analyst Jonathan Chaplin told Reuters. "It makes investors worry the market is really in trouble."

T-Mobile's ETF announcement last month "may have pushed AT&T too hard," making it fight back, J.P. Morgan Securities analyst Philip Cusick told Reuters. "The back and forth in price cuts is a negative for the entire wireless industry," he said.

For more:
- see this CNET article
- see this Re/code article
- see this WSJ article (sub. req.)
- see this Aio Twitter post
- see this Aio page
- see this Reuters article

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AT&T to offer up to $450 in credit to T-Mobile customers who switch over