Sprint Nextel Corporation (S), AT&T Inc. (T), Verizon Communications Inc. (VZ): Will You Be Trapped by Your Wireless Provider?

In the days leading up to the new rule’s enactment, smaller-time player T-Mobile, the U.S. wireless operation of Deutsche Telekom AG (ADR), has been promoting lower monthly plans if you bring in your “unlocked AT&T phone.” This is a last-ditch effort (perhaps) to capture some of the dissatisfied customers looking for a way out of their current networks.

With the abrupt slowing of new mobile users each quarter — dropping from 5 million in 2011 to 3 million in 2012 — there is reason for the carriers to be protective of their current customers. AT&T and Verizon are at the top of the pack, with over 70% of the total market share between them.  Though both Sprint and T-Mobile, with unlimited everything these days, have tried to undercut the two kings of the hill, there has been little movement of either company in the market share category. In fact, AT&T has tried to buy T-Mobile, only to be blocked by regulators.

Moving forward
Though the law backtracks to ones that governed consumers years ago, there will probably be little outcry from the majority of customers, who will have the option to buy unlocked phones from the carriers for full retail prices. Most likely, this new rule will only affect a very small number of consumers. If the new ruling is able to help steady the flow of customers from one provider to the other, investors should look for improved retention rates and consistent revenue from signed contracts.

The article Will You Be Trapped by Your Wireless Provider? originally appeared on Fool.com and is written by Jessica Alling.

Fool contributor Jessica Alling has no position in any stocks mentioned, but you can contact her here. The Motley Fool has no position in any of the stocks mentioned.

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