T-Mobile said today that it will include a Netflix subscription in its unlimited T-Mobile ONE family plan service at no extra charge beginning September 12. “The world is about to find out what happens when you bring two disruptors together,” said T-Mobile CEO John Legere in a webcast announcing the T-Mobile Netflix offer.
According to Legere, competitive carriers are unlikely to match the T-Mobile Netflix offer because their networks would not be able to handle the increase in traffic.
T-Mobile “didn’t get a big discount” from Netflix to support the new offering, Legere said. To qualify for the Netflix offer, customers must be on a T-Mobile ONE family plan with at least two lines, Legere said. According to a T-Mobile press release, T-Mobile customers on other plans can convert to a T-Mobile ONE plan in order to qualify for the T-Mobile Netflix offer.
T-Mobile customers that already get Netflix can use a T-Mobile app to link their existing Netflix account with their T-Mobile account so that T-Mobile will cover the cost of the Netflix service, Legere explained.
T-Mobile Netflix Offer
Wireless carriers have reached a “critical tipping point,” with video now comprising more than 50% of total mobile traffic, Legere said. AT&T has responded by buying DirecTV and Verizon has responded by purchasing AOL and Yahoo, he said. But he argued that T-Mobile’s strategy is smarter because Netflix is by far the most popular over-the-top subscription video offering.
Netflix is so popular, however, that Legere doesn’t believe some other carriers are in a position to match the T-Mobile Netflix offer. The reason is that some carriers’ networks are already struggling to support recently launched unlimited offerings.
It was just about a year ago that T-Mobile launched its T-Mobile ONE Unlimited plan – an offering that ultimately drove the other three major U.S. wireless carriers – AT&T, Sprint and Verizon — to also launch unlimited service. Those unlimited offerings have strained some carriers’ networks, however – a reality that has helped T-Mobile performance scores rise in comparison with its competitors.