This week T-Mobile made a splash among mobile carriers, announcing three new improvements to their available services: they will begin to offer the iPhone next month, their own 4G LTE service, and (most notable of all) they have completely eliminated contracts from their pricing plans. While the first two updates to their offerings seem like efforts to keep up with the pack, the third is sure to shake up consumers’ decision-making.
Instead of offering subsidized pricing on handsets and usage plans in exchange for signing a long-term contract, T-Mobile will allow customers to use month-to-month packages. For example, customers can pay $50 per month for unlimited calls and texts, and 500MB of data. Additional data can be added in increments of 2GB for $10 per month. The set up will be attractive for anyone who already owns a device looking for a deal on a plan. For folks who like to regularly have the latest and greatest devices, the plan will not prove to be much savings, but allow them to do so without a binding agreement. The catch is that brand-new handsets will require a down payment and monthly payment plan. Even if you leave T-Mobile, you’re still responsible for a monthly payment on a phone until it is paid off.
At their “UnCarrier” press event, T-mobile’s CEO John Legere and other executives set the stage for their great shift in carrier culture by taking stabs at competitors for their over-confusing contracts. Legere had some choice words about his rivals, the least of which calling the status quo industry plans “smartphone hell.”
“Customers don’t need another AT&T,” said Legere. “Customers need someone to stop acting like AT&T.”
The T-Mobile 4G LTE network is now available in seven US cities: Kansas City, Las Vegas, San Jose, Washington D.C., Baltimore, Phoenix, and Houston. The company is touting the service as an upgrade from existing LTE networks.
“4G LTE deployment will complement its existing nationwide 4G network — which third-party tests show rivals or beats existing LTE networks — creating what T-Mobile expects to be the fastest 4G combination in the United States,” they stated in a press release.
As the number four carrier in the country, T-mobile is making bold moves to stay aggressive in the fight for their share of mobile users. Only time will tell if the new plan and distancing themselves from their rivals will pay off.