T-Mobile (TMUS) recently spotted an alarming shift in customer behavior shortly after implementing a series of price increases over the past year.
Most recently, in April, T-Mobile made the harsh decision to hike the monthly rate for a few of its older phone plans by $5. Weeks later, it further frustrated customers by increasing its Regulatory Programs & Telco Recovery Fee from $3.49 to $3.99 for voice lines and $1.40 to $1.60 for data-only lines.
💵💰Don’t miss the move: Subscribe to TheStreet’s free daily newsletter 💰💵
Amid these changes, some customers took to social media to express outrage with the company’s recent price increases, with some even threatening to switch phone providers.
Related: T-Mobile quietly discontinues yearslong offer customers love
It appears that some customers followed through on that threat, as T-Mobile revealed in its first-quarter earnings report for 2025 that its postpaid phone churn, the number of customers who cut their phone service, increased by 5 basis points year-over-year during the quarter.
Also, while T-Mobile attracted 495,000 new postpaid phone customers during the quarter, that number is 6% lower than the amount it welcomed during the same quarter in 2024.
During an earnings call in April, T-Mobile CEO Mike Sievert said the steeper loss in customers was primarily due to growing concerns about the economy.
“So overall, you saw across the industry churn was just on the margin a little elevated, and I think there’s a number of dynamics there,” said Sievert during the call. “That probably has more to do with kind of macro questions than with competition. You know, I think there’s a certain element out there where people are in a time of uncertainty about the future, grabbing what they can afford now. And so, you’re seeing kind of some amount of probably move forward of upgrades and switching.”
T-Mobile makes unexpected move to attract frugal customers
In light of this concerning trend, T-Mobile is ramping up its efforts to win back customers deterred by recent price increases.
The phone carrier has announced that it will launch three new low-priced prepaid plans on June 24, each with a five-year price lock guarantee, according to a recent press release.
T-Mobile says that its new Starter Monthly plan is for “value seekers” and will offer unlimited talk and text, and 15GB of high‑speed data for $40 a month with autopay activated.
Related: T-Mobile CEO has a harsh warning for customers
Unlimited Monthly, the next tier up, will also offer unlimited talk and text, but will give customers 5G data and unlimited hotspot data at 3G speeds for $45 a month with autopay.
Lastly, Unlimited Plus Monthly, which is $60 per month with autopay, will offer customers unlimited talk, text and 5G data, but up to 5GB of high-speed hotspot data.
It will also contain international benefits such as unlimited talk and text to the U.S. while roaming in Mexico and Canada, and unlimited texting from the U.S. to over 215 international destinations.
T-Mobile’s new offers come with an unpleasant surprise
Despite the low prices attached to these new offers, one red flag remains. Taxes and fees are excluded from the monthly prices, which allows T-Mobile to continue hiking monthly bills by increasing fees or cutting monthly discounts.
Removing taxes and fees from prices is a practice T-Mobile adopted earlier this year when it introduced its new Experience More and Experience Beyond phone plans in April.
More Retail:
- Costco quietly plans to offer a convenient service for customers
- T-Mobile pulls the plug on generous offer, angering customers
- AT&T makes generous offer to older customers
The phone carrier also allegedly plans to omit taxes and fees from watch and tablet plans very soon.
A source close to T-Mobile told TheStreet last week that the phone carrier has been excluding taxes and fees from some of its plan prices due to it receiving feedback that this information was confusing for customers, making it more challenging for them to compare plans across different providers.
The changes from T-Mobile come as it faces increased competition from cable companies, which have recently attracted price-conscious phone customers.
According to a recent report from MoffettNathanson, Spectrum, Comcast, and Altice USA have added 886,000 new phone customers during the first three months of 2025, which is up from the 804,000 they added during the same time period last year.
Related: Verizon pulls the plug on a convenient service for customers
