Impact of T-Mobile’s acquisition of iWireless
Rural Customers
T-Mobile’s decision to terminate most of iWire-
less’ authorized dealers le many communities
without convenient access to wireless stores
where customers could purchase or upgrade
devices, seek advice on service plans, and get
basic technical support. Despite the growth of
e-commerce and online shopping, brick and
mortar retail continues to play an important role
in wireless, with U.S. consumers purchasing
nearly 90 percent of mobile phones at physical
stores in 2017.
40
Physical retail is especially
important to elderly citizens, who generally
prefer to purchase items in-store rather than
online, and to low-income customers, who
generally have a higher propensity to shop
in-store compared to higher-income consum-
ers.
41
The residents of rural counties tend to be
older and poorer than in urban counties, making
physical stores an important element of rural
access to wireless telephone and internet
services.
42
Prior to the transaction, iWireless had stores in
48 dierent rural communities across Iowa
where no other wireless carrier had a retail
location.
43
While residents of some of those com-
munities may be able to purchase wireless
services from big-box retailers such as Walmart,
the closure of those iWireless authorized dealers
le a void that big-box retailers cannot fill. Local
dealers provide more personal and higher-quali-
ty service than big-box re-sellers.
44
The impor-
tance of carrier stores over big-box stores was
acknowledged by Sprint’s former chief service
oicer, Bob Johnson: “When customers really
want hands-on, quality service, they're going to
look for the Sprint shingle.”
45
Sarah Crock, a former iWireless authorized
dealer from Tipton, a rural community of about
3,200 residents in eastern Iowa, exemplifies the
value that local authorized dealers provided to
rural communities.
46
Ms. Crock ran her iWireless
dealership out of the oice where she and her
husband operate an insurance agency and a real
estate agency. Ms. Crock stated that although
iWireless was not a significant source of revenue
for her business, her iWireless dealership was
“much-needed” in the community.
According to Ms. Crock, her clients were very
upset over the loss of iWireless. Once she
stopped selling iWireless services, the only
choice for customers that did not want to travel
out of town was Walmart. “Some of [my former
customers] that I’ve talked to have been forced
get smartphones at Walmart, where they have no
customer service locally. There's no way to go in
and get help with the phone or nothing. That’s
forced [my former customers] to drive out of
town to wherever to take up a dierent compa-
ny.”
47
The closest T-Mobile store to Tipton is
located in Iowa City, about 32 miles away.
48
Ms. Crock also reported that there are group
homes in Tipton that support adults with devel-
opmental disabilities and the transition was “a
nightmare” for some of them, due to lack of
transportation. Ms. Crock stated that aer she
stopped selling iWireless services, some of her
former customers from the group homes were
unable to go to other wireless retail locations
because they didn’t have transportation. “It’s
things like that that made somebody local so
vital for people with disabilities that needed
something right here,” Ms. Crock added.
DISRUPTING RURAL WIRELESS: HOW A T-MOBILE TAKEOVER HARMED CONSUMERS AND SMALL BUSINESSES IN IOWA
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FEBRUARY 2019