T-Mobile USA, which finds itself in uncertain times as it waits for regulatory approval of its merger with AT&T, announced a new unlimited smartphone plan for $80. The plan includes unlimited nationwide calling, texting and data with no overage charges.
T-Mobile said the new plan, combined with its "affordable smartphones," enables subscribers to save more than $350 per year on an unlimited smartphone plan compared to similar plans from AT&T (NYSE:T), Verizon Wireless (NYSE:VZ) and Sprint (NYSE:S). Rather than instituting overage charges, T-Mobile said customers exceeding 2 GB of data usage in a billing month will have their speeds throttled until the new billing cycle starts. T-Mobile said
The new offering replaces T-Mobile's previous $100 unlimited voice, text and data plan. Under the old offering, throttling did not happen until a customer had reached 5 GB. AT&T charges overage fees after 2 GB.
Current Analysis analyst Weston Henderek noted that T-Mobile's new plan should help the operator generate more interest among the valuable heavy users. "However, the plan also has the potential to squeeze T-Mobile from an ARPU perspective if existing unlimited customers on higher end rate plans decide to downgrade," he said. "This could be problematic if the new offering fails to bring in new customers in an increasingly saturated U.S. wireless market. Despite this, the ARPU risk appears to be a necessary evil for T-Mobile as it tries to jumpstart some growth during an uncertain period."
T-Mobile's HSPA+ 21 network currently covers more than 200 million POPs in more than 167 markets. By mid-year, the carrier plans to deploy dual-carrier HSPA+ 42 to 140 million POPs in 25 markets.
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