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T-Mobile ends overage charges, CEO challenges competitors to follow

A T-Mobile store sign is seen in Broomfield, Colorado February 25, 2014. REUTERS/Rick Wilking
A T-Mobile store sign is seen in Broomfield, Colorado February 25, 2014. REUTERS/Rick Wilking

By Marina Lopes

NEW YORK (Reuters) - T-Mobile US Inc said on Monday it would stop charging penalties for customers who go over their data plan limits and launched an online petition calling for rival carriers to do the same.

The announcement means T-mobile's customers won't have to pay for any data beyond the limit they sign up for. Customers who hit their data limit will have their speed slowed down to 2G until they buy another data bucket.

"Today I'm laying down a challenge to AT&T, Verizon and Sprint to join T-Mobile in ending these outrageous overage penalties for all consumers - because it's the right thing to do," T-Mobile Chief Executive John Legere said in a statement.

It was the latest in a series of marketing salvos fired by the No. 4 U.S. telecoms operator across rivals' bows. Legere's prior efforts to redefine the cellular pricing model helped the company turn the corner in 2013 after four years of steadily losing customers, through a combination of marketing savvy and well-publicized wireless plans.

In January, T-Mobile, which is 67 percent owned by Deutsche Telekom , launched a website where rivals' customers can write breakup letters to their carriers and offered to pay up to $350 in termination fees per line for users to switch carriers.

(Reporting By Marina Lopes; Editing by Jonathan Oatis)

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