Once upon a time, TMobile prided itself as the “uncarrier” wireless company. After acquiring Sprint, it quickly abandoned a strong commitment to innovate and enhance its value proposition. See https://telefrieden.blogspot.com/2018/06/life-in-antitrust-wonderland-suspension.html; https://telefrieden.blogspot.com/2019/11/more-overstatements-about-lovefest.html.
TMobile quickly realized that it did not have to spend sleepless afternoons competing with AT&T and Verizon. The market had become so concentrated that TMobile could increase their profit margin through what antitrust experts call conscious parallelism: a go along, get along, strategy that comes close to collusion. Now, little differentiates the three national carriers aside from what “free” video streaming they offer high margin subscribers.
Southwest Airlines, perhaps reluctantly, has followed the T Mobile strategy. For many ears, the airline differentiated itself from the other large, legacy carriers, by offering lower fares, open seating without additional charge, and free carriage of two bags. Eventually Southwest realized it did not have to offer the lowest rates for every route. Recently, it announced the cancellation of open seating, disingenuously characterizing the decision as a revenue neutral response to consumer demand. See https://www.cnn.com/2024/07/26/business/southwest-boarding-history/index.html.
Does anyone really believe Southwest will not monetize seat access just like the other carriers? Southwest realized that it could eliminate this perk and convert seat access into a new profit center, just like the other airlines. Why not make a bundle on decoupling air carriage from where a passenger sits.
It is not rocket science to detect an obvious outcome: when markets concentrate, through mergers, acquisitions, barriers to market entry, and lax antitrust enforcement, the surviving businesses have little incentive to reduce rates and enhance the customer experience.
Because consumers have limited choices in airlines and wireless carriers, we cannot vote with our pocketbooks and take our business elsewhere when we suffer from bad—vary bad—customer care.
TMobile is not the fearless, iconoclastic uncarrier anymore and neither is Southwest.
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