T-Mobile rocks a data rollover offer, with a 10GB bonus

The Uncarrier 8 campaign kicks off with Data Stash, a program that lets you keep what you haven't used. Says CEO John Legere: "If you buy data, it's yours."

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Roger Cheng
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John Legere, CEO of T-Mobile, speaks at an Uncarrier event in SF on September 10, 2014. Josh Miller/CNET

T-Mobile is bringing back the rollover concept.

The Bellevue, Wash., wireless carrier on Tuesday unveiled Data Stash, a program that allows you to roll over your unused data. The program goes into effect in January for new and existing customers with at least a 3-gigabyte phone data plan (or 1 GB tablet data plan) will also get a bonus 10GB of data for the "stash." Once users eat up that 10 GB of data, they will start to roll over their unused data.

"If you buy data, it's yours," T-Mobile CEO John Legere said on a webcast after the announcement.

Uncarrier 8.0 is the latest in a wave of promotions, discounts and programs rolled out by the carriers, with each looking to one-up the others in their fight for subscribers. The competition is starting to take its toll on the carriers, cutting into their revenue and profits, but it has proven a boon to consumers willing to shop around for the best deals.

The concept of rollover data is similar to that of rollover minutes that AT&T (previously known as Cingular) once used to great effect. The bonus data lasts through 2015, and the rolled over data gets stored for the following 12 months. By adding 10 GB of data on top of the Data Stash program, T-Mobile joins the band of carriers offering more data.

Legere said that he received 40,000 tweets asking for data rollover. "Everything we do comes from individual customers," he said.

Chief Marketing Officer Mike Sievert said that 80 percent of customers typically activate with 3GB of data at its retail stores, making a vast majority of its subscribers eligible for the program.

Most of T-Mobile's customers are on data plans that offer a set amount of data at 4G LTE speeds. Once they hit their limit, the carrier "throttles," or slows down the connection for the rest of the billing period. That's particularly the case for customers who sign up for lower-end plans with smaller data allocations. The rollover program would allow customers to hoard data on quieter months for use later. Heavy users, however, likely won't be able to benefit much, since they would hit their caps each month anyway.

Sievert declined to comment on the estimated cost of the program, but he acknowledged that there was a risk in the investment. As with other Uncarrier moves, the rollover program is designed to attract customers, which will initially weigh on its profits. But as customers stay on the service longer, T-Mobile recuperates their costs and starts to generate income on those subscribers.

"There's significant cost to this," he said. "But it makes customers happy."

So many promos

Uncarrier 8.0 caps off a busy year for T-Mobile, which made five such large announcements in addition to smaller promotions.

But T-Mobile hasn't been alone, with the promotions having flown in fast and furiously. Sprint earlier this month vowed to cut the rate plans by half for customers defecting from AT&T or Verizon Wireless. Last week, T-Mobile unveiled a $100 unlimited data plan for two, and brought back its popular $100 family plan, which includes 10 gigabytes of data (2.5 GB per user). The discounts follow a flurry of deals from Sprint, AT&T and Verizon Wireless offering to double the data on specific family plans.

Verizon last week said that while its customer additions was on the rise, it was also experiencing higher turnover as a result of competitive promotional offers. It's not an isolated issue. The four national carriers collectively lost $45 billion in market capitalization over the past month on concerns about the cost to sell wireless service and future growth in profits, according to The Wall Street Journal.

While T-Mobile and Sprint have been primarily targeting their larger two competitors, there have been sparks between the two carriers. Legere has said he expects to surpass Sprint in terms of subscribers by the end of the year. "Put a fork in it," he said in September. "They're done."

Legere was asked on the webcast about whether BlackBerry would return to T-Mobile, and hinted at a possible reconciliation, while putting the onus on the handset manufacturer. "I'm open to the idea of finding a way for a customer to get a BlackBerry on T-Mobile," he said. "But it requires cooperation from BlackBerry."