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Cheap plans are going to cost 5,000 T-Mobile employees their jobs

By Anam Hamid

Updated: Aug 25, 2023, 8:06 AM

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Cheap plans are going to cost 5,000 T-Mobile employees their jobs

As a recent rumor had indicated, 7 percent of T-Mobile employees are going to lose their jobs over the next five weeks.

To ward off competition, T-Mobile has been offering affordable plans but those aggressive plans will result in the loss of jobs for 5,000 employees.

In a letter addressed to employees, the wireless provider's Chief Executive Officer Mike Sievert said that attracting and retaining customers is now "materially more expensive than it was just a few quarters ago." He added that expanding the high-speed internet business and efforts in other units are "not enough to deliver on these changing customer expectations going forward."

Letting staff go is a cost-cutting measure as T-Mobile continues to spend heavily to target new customers. The decision will primarily impact corporate and back-office employees as well as some technology roles. Retail and consumer-care staff won't be affected.

Bloomberg believes that is a proactive move to offset discounts and free phone promotions we will see during the holiday season, particularly for the upcoming iPhone 15 series.

According to a recent report, the new Pro models are expected to be more expensive than the current generation but carriers are likely to offer huge discounts. There has been a historic decline in upgrades this year across all carriers and the iPhone 15's release will be an opportunity to target high-value customers.

T-Mobile has seen a slowdown in subscriber growth as cable companies Comcast Corp. and Charter Communications Inc. entice new users by offering incentives such as free lines.

T-Mobile reported better-than-expected profits last month and also raised the subscriber forecast for the year, so the layoffs are kind of surprising. The company added 760,000 subscribers during the second quarter which it called its best second quarter in eight years. It was also the top choice for customers looking for inexpensive plans in the last three quarters.

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Anam Hamid is a computer scientist turned tech journalist who has a keen interest in the tech world, with a particular focus on smartphones and tablets. She has previously written for Android Headlines and has also been a ghostwriter for several tech and car publications. Anam is not a tech hoarder and believes in using her gadgets for as long as possible. She is concerned about smartphone addiction and its impact on future generations, but she also appreciates the convenience that phones have brought into our lives. Anam is excited about technological advancements like folding screens and under-display sensors, and she often wonders about the future of technology. She values the overall experience of a device more than its individual specs and admires companies that deliver durable, high-quality products. In her free time, Anam enjoys reading, scrolling through Reddit and Instagram, and occasionally refreshing her programming skills through tutorials.