AT&T Inc on Friday offered customers of No.4 U.S. mobile provider T-Mobile U.S. Inc a $200 credit to switch to its service, firing the first volley in what may be a price war that benefits consumers but plays havoc with profits, Reuters.com reports.
AT&T, the No.2 U.S. mobile provider, announced the promotion after months of direct marketing against it by T-Mobile.
T-Mobile, majority owned by Germany’s Deutsche Telekom AG, has marketed itself as more consumer-friendly, lower priced and more flexible than its bigger rivals.
CNET.com reported T-Mobile might launch a larger broadside at the Consumer Electronics Show next week.
Responding to AT&T’s pricing offer, according to CNET.com, CEO John Legere claimed AT&T was bribing consumers to come back “but they won’t be fooled.”