T-Mobile’s new contract-free plans eliminate the subsidized phone model. Tuesday, T-Mobile will officially unveil their new rate plans and LTE services in an effort to rebrand the company as the “uncarrier”.
T-Mobile’s new Value Plan options will include Unlimited Talk, Text and 500MB of data starting at $50/month. You can also add $10 for every extra 2GB of data or pay $20/month more for Unlimited Data. T-Mobile’s pricing for families follows a similar pattern. Customers can add 2 to 5 lines of service, and can then select among the 500 MB, 2.5 GB and unlimited data options.
CEO John Legere announced today its AWS-equipped iPhone 5 will cost $579, or $99, plus 24 monthly payments of $20. That’s contract-free, but the device is locked until it’s fully paid for, and the cheapest monthly plan to go with it is $50 for 500MB of data and unlimited voice and texting a month. By contrast, the same 16GB phone unlocked direct from Apple costs $649, while AT&T offers a locked model for $199 — if you sign a 24-month contract — with the cheapest possible plan providing a mere 300MB of data, 450 minutes and no texting at a cost of $60 a month.
T-Mobile announced that qualifying customers can get an iPhone 5 for $99.99 down, plus monthly payments. T-Mobile’s new Simple Choice Plan starts with a base rate of $50 per month for unlimited talk, text and Web with 500MB of 4G data.3 Consumers can add 2GB of 4G data for $10 per month per line or get unlimited 4G data for an additional $20 per month per line.
The large carriers operate a racket with smartphone subsidies. They keep charging you $20/month for your purchase of a smartphone even after it’s paid for. Typically $20/mo times 24 months ($480) pays off a $100-$200 smartphone. Surprisingly this racket is legal for carriers. Consumers have come to expect to pay more.
T-Mobile’s new plans undercut those of Verizon Wireless and AT&T. Unlimited voice and texting with 2 GB of data on Verizon’s Share Everything plan costs $100 per month; on T-Mobile it’s $60 (though without the monthly cost of a smartphone payment).
A report from research firm OpenSignal found that T-Mobile LTE is currently live in nine United States cities.
T-Mobile’s Sonic 2.0 hotspot (pdf), available now for $149.99, is the carrier’s first LTE hot spot. It can connect up to eight devices using 850 MHz as well as their PCS and AWS frequencies (with HSPA and LTE).
An unlocked iPhone 5, sold by AT&T and Apple, will be able to work with T-Mobile’s LTE 1700 (AWS) and WCDMA/HSPA+ 1900 (PCS) network with a minor software update, but it won’t work with T-Mobile’s faster HSPA+, on their AWS network. Only the iPhone 5 sold by T-Mobile will have faster (HSPA+42) coverage from day one. T-Mobile’s HSPA+ 42 Mbps network gangs a couple of 5MHz channels together for faster speeds.
T-Mobile is using the AWS band (1.7/2.1 GHz) for LTE and moving HSPA to their PCS band (1.9 GHz), sharing the frequencies with their voice service. That also makes T-Mobile’s HSPA more compatible with old-timey iPhones that don’t offer AWS service and use AT&T’s HSPA on their PCS band.