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T-Mobile US Announces Free Data for Pokemon Go Players

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In a bid to capitalize on the rapidly growing global mobile gaming app, Pokemon Go, T-Mobile US Inc. (TMUS - Free Report) announced free data for customers who have become addicted to the augmented reality game. The offer will be made available through its ‘T-Mobile Tuesdays’ app. It came as part of T-Mobile US’ strategy of attracting customers. Note that this followed T-Mobile US' ‘Get Thanked’ program, under which it offered lucrative giveaways like Wendy’s ice-creams, movie rentals and a host of other freebies. The company even proposed to give a stock to its postpaid customers as a reward under this program.

Details

This limited period offer will extend from Jul 19 to Aug 9, 2016. Customers availing the offer will be able to play Pokemon Go for no extra data charges till Aug 2017. The offer will also give away PokeCoins worth $100 to 250 customers. Additionally, five lucky winners will win a trip for two to anywhere in the U.S.

Notably, Pokemon Go, the popular creature collecting game, has overtaken Facebook Inc. and Twitter Inc.’s apps in terms of daily users.

Net Neutrality Issue

Zero-rated plans, under which wireless carriers offer free data to customers for using certain apps, have been accused of violating net neutrality. T-Mobile US was even accused of suppressing video streaming using third-party video streaming services in the past while giving preference to streaming videos in its ‘Binge On’ app. The practice was criticized because waiving off data for certain apps invariably dented the competitive edge of its peers. However, Pokemon Go uses very little data, with peak usage of 10 Megabytes per hour. This makes us quite confident that net neutrality proponents won’t be too bothered by the move.

The Bottom Line

Competition in the U.S. telecom space has been intense of late. Relatively smaller carriers like T-Mobile US have been luring customers through attractive offers, while industry behemoths such as Verizon Communications Inc. and AT&T Inc. (T - Free Report) continue to face challenging conditions. To counter these competitive threats, AT&T recently launched a customer awards program. Although T-Mobile US has been gaining momentum of late backed by a growing customer base, we are yet to know for sure if its slew of generous offers will allow the company to capture market share from the top players.

T-Mobile US carries a Zacks Rank #2 (Buy)

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