Verizon: T-Mobile CEO Is Dopey to Say Were Streaming Low-Res Video

By Markets Fool.com


Source: T-Mobile.

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T-Mobile's CEO John Legere has a history of spouting his opinions. Some of his outspokenness has proved beneficial, and other times it has seemed a tad immature.

But just last week Legere's words sounded flat out false, at least according to Verizonand AT&T . Legere said in a video that its rivals' Netflix streamingquality is inferior to T-Mobile's, even when using its Binge On service.

Binge On let's T-Mobile customers switch over to a lower-resolution video stream (480p) in exchange for streaming that doesn't eat into their monthly data allowance. The service works with 50 popular video and music sources, including Netflix, ESPN and Spotify..

Specifically, Legere said, "And the duopoly is actually delivering your Netflix content at 360p. I'll bet you didn't know that. Go check; it's true."

Them's fightin' words
Legere claims that its competition is intentionally downgrading customers' Netflix streams (presumably to save on bandwidth), but the two carriers say this just isn't true.

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"We do not reduce the resolution of any video on our network -- in fact, our customers on 4G LTE can get much higher resolution than T-Mobile's optimized 480p limit," AT&T told FierceWireless in an email.

And Verizon Wireless' director of corporate communications, Chuck Hamby, said that the carrier doesn't set any speeds for playback, responding, "It's just a dopey claim and has no basis in fact at all."

Why this matters for T-Mobile
First of all, it's a bit surprising Legere would make this claim to begin with. You can believe that if AT&T and Verizon customers were watching Netflix in 360p you'd hear quite a bit about. That would be some poor quality video indeed.

Secondly, it's a bad time for Legere and T-Mobile to throw some fuel on the fire that has ignited around Binge On. The feature has taken a few PR hits since it launched in November, mainly do to opt-in issues and net neutrality questions.

The original issue was that T-Mobile didn't make it clear to users how they could switch on Binge On, nor how to opt out of it. T-Mobile has fixed that, making it easy for users to opt in, and to turn the feature off when they choose to. But more importantly, the service has raised questions about whether or not the carrier is skirting net neutrality rules by allowing some content to count against a users' monthy data allotments while other content doesn't.

It's worth nothing that when Binge On was first introduced, FCC Chairman Tom Wheeler describe the service as "highly innovative and highly competitive." That's important, because the FCC is the governing body that determines whether or not Binge On is actually going against net neutrality.

Additionally, YouTube -- which formerly criticized Binge On for its 480p quality video -- just signed up as an official partner. YouTube climbed on the bandwagon after T-Mobile said it would allow Binge On partners to optimize their video streams. It's a huge deal for T-Mobile that YouTube is now on board, considering that the video streaming service accounts for 21% of peak downstream traffic on mobile devices.

In short, Legere picked a poor time to stir up its competitors -- just as it's starting to settle the issues with Binge On that critics were bringing up.

But at the end of day, Binge On lets T-Mobile customers opt into a feature that can save them gobs of data every month. Legere may have spokenincorrectly about Verizon and AT&T, but the service itself will likely continue to propel T-Mobile's explosive customer growth. The company's Uncarrier events, of which Binge On is a part of, have helped T-Mobile bring in more than 1 million net customers each quarter for the past 11 consecutive quarters.

Legere's claims about the AT&T and Verizon's Netflix streams may be untrue, but this event is unlikely to hurt the carrier's growth. And that's probably what Verizon and AT&T are really the most unhappy about.

The article Verizon: T-Mobile CEO Is Dopey to Say Were Streaming Low-Res Video originally appeared on Fool.com.

Chris Neigeris a T-Mobile customer, but has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Netflix. The Motley Fool recommends Verizon Communications. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.