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T-Mobile Ends Contracts and Subsidies

Posted by Soulskill on from the reducing-complexity dept.

AlphaWolf_HK writes "In what I see as a refreshing change, T-Mobile, the fourth largest carrier in the U.S., has made sweeping changes to its service, ending both phone subsidies and service contracts. Its CEO said, 'Here's the deal: If we suck this month, go somewhere else. If we're good, stay with us.' As part of that change, the new base plan will include unlimited access, including voice, text, and data. Data will be restricted to edge speeds after 500MB with no overage costs, but can be upgraded to 2.5GB for $10, or unlimited for $20. Portable Wi-Fi hotspot usage is also unrestricted for no additional cost. In addition, LTE services just went live in eight markets. As is already standard practice with T-Mobile, you are free to bring your own device. To keep customers from having to front the full cost of the phone with unsubsidized plans, they'll let people pay off phones in installments. They're also getting the iPhone 5 next month for $650."

5 of 404 comments (clear)

  1. They get it by SgtKeeling · · Score: 5, Insightful

    It sounds like T-Mobile is going to be offering reasonable, attractive cell phone plans. Wow. I'm genuinely surprised that such a large carrier is moving in this direction. Good on them.

  2. Pay Later: $199 down + $15/month by tepples · · Score: 5, Insightful

    However I am somewhat concerned as I have already seen too many people complain that they'd have to foot the bill for the full cost of the phone. The math would may prove to be difficult for people who are not good at it.

    They could phrase it like this:

    Pay Later: $199 down + $15/month for 24 months
    Pay Now: $549

    The down payment on the Pay Later choice would reasonably match the price with contract on other carriers.

    1. Re:Pay Later: $199 down + $15/month by slinches · · Score: 5, Insightful

      Just checked the plan prices. I compared "unlimited" everything since that's the closest match between features.

      AT&T - unlimited voice $70 + 3GB data $30 + unlimited messaging $20 = $120 per month

      T-Mobile - Unlimited voice, high speed data and messaging $70 + $20 Phone installment plan = $90 per month

      Assuming the down payment on the phone is similar, the T-Mobile plan is ~$700 ($30*24) less over the 2 year AT&T contract. After the phone is paid in full the installment plan ends and saves $50/month over AT&T.

      --
      Knowledge Brings Fear
  3. So glad they weren't allowed to merge with AT& by Anonymous Coward · · Score: 5, Insightful

    I hope the FTC takes note of this. Good things are happening because companies have to innovate to compete instead of take refuge in mega-mergers.

  4. Re:They are forced to by jfern · · Score: 5, Insightful

    Of course having competition requires good regulations. There would be a lot less competition here if the Justice department hadn't successfully blocked AT&T's purchase of T-Mobile.