T-Mobile undercuts AT&T, Verizon with new Value plans, starting at $50/month

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T-Mobile USA officially unveiled a key part of its new "Uncarrier" strategy by releasing new pricing for its Value plans (which do not include device subsidies).

The plans break into three options:

  • $50 per month for unlimited talking and texting and 500 MB of high-speed data. Smartphone hotspot service is included. Speeds are slowed to 2G speeds after 500 MB.
  • $60 per month for unlimited talking and texting and 2.5 GB of high-speed data. Smartphone hotspot service is included. Speeds are slowed to 2G speeds after 2.5 GB.
  • $70 per month for unlimited talking and texting and unlimited high-speed data. The plan also includes 500 MB of smartphone hotspot service, with additional data costing extra.

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. The full data allotments are available to each line of service--a notable difference from the shared data plans from AT&T and Verizon, which require family members to share the same pool of data.

As for T-Mobile's network management policies, the carrier said "data traffic of postpaid plans with limited high-speed data allotments greater than 2 GB will be prioritized over other currently offered plans during periods of congestion. Service may be slowed, suspended, terminated or restricted for misuse, abnormal use, interference with our network or ability to provide quality service to other users, or significant roaming."

The carrier made the new plans available on its website yesterday, Just ahead of a media event scheduled for tomorrow in New York City where top executives will likely fill in the details on the company's plans to shake up the industry with new pricing.

T-Mobile's new Value plans are in line with earlier leaks to the website TMoNews

The key element of the plans is that they do not include traditional subsidies, since customers are not required to sign a long-term service contract. Instead, customers can either buy their smartphone outright for the full cost of the device or they can make a down payment and then pay for the remainder of the cost of the device in monthly installments.

For example, a customer could pay $550 for the full price of a Samsung Galaxy S III, or make a down payment of $70 and then make monthly payments of $20 per month for 24 months. Or a customer could pay $360 for the full price of a Nokia (NYSE:NOK) Lumia 810, or walk out of the store with the phone for free and make monthly payments of $15 per month for 24 months.

T-Mobile's new plans undercut those of its rivals, especially Verizon Wireless (NYSE:VZ) and AT&T (NYSE:T) Mobility. To get unlimited voice and texting and 2 GB of data for a smartphone on Verizon's Share Everything plans costs $100 per month; on T-Mobile it's $60 (though without the monthly cost of a smartphone payment).

T-Mobile also continues to offer its bring-your-own-device plans.

Interestingly, T-Mobile will reportedly continue to offer its traditional Classic plans with device subsidies at third-party retailers like Best Buy, Target and Walmart. That decision is being made because apparently those retailers cannot support T-Mobile's billing system that allows customers to pay the full cost of a device upfront or pay off the cost a device over time. T-Mobile has not confirmed those details.

For more:
- see this T-Mobile site
- see this TMoNews article
- see this The Verge article
- see this CNET article

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