T-Mobile 'Unlimited' Monthly 4G Plans Will Challenge Verizon, Sprint
T-Mobile's new growth strategy includes "unlimited" 4G plans with no annual contract and Family Plans with savings said to beat plans from Verizon, AT&T and Sprint.T-Mobile has introduced two new No Annual Contract plan for subscribers to its 4G network, as well as a suite of family and individual plans, proving again that it's working in earnest to boost its bottom line-despite the possibility of being folded into AT&T in a matter of months. T-Mobile's "unlimited" Monthly 4G plans require no annual contract. The plans also offer unlimited talk, unlimited text and unlimited Web surfing, with the first 100MB of data at 4G speeds where available, for $50; or, for $70, unlimited talk, text and Web with the first 5GB of data at 4G speeds where available.
Instead of charging for data overages, as AT&T and Verizon do, T-Mobile's strategy-as with the Even More plans it introduced in April-is to knock the user off of 4G and onto a slower technology after the agreed-upon data allotment has been surpassed.
As data usage continues to explode, spectrum is becoming a constraint to our business, with T-Mobile facing spectrum exhaust over the next couple of years in a number of significant markets. Moreover, our spectrum holdings will not allow us to launch LTE. T-Mobile also lacks the low band spectrum that would enable it to offer nationwide deep in-building coverage, particularly to reach homes in suburbs and in rural areas. In addition to these unsolved strategic issues, T-Mobile's parent Deutsche Telekom is not in a position to finance the necessary large scale investments in the U.S. for T-Mobile to remain competitive.Whether T-Mobile, the nation's fourth-largest carrier can remain competitive is arguably not as central to the debate as whether the combination of AT&T and T-Mobile, which would result in AT&T and Verizon controlling approximately 80 percent of the market, would prevent number-three carrier Sprint from effectively competing for customers. Sprint CEO Dan Hesse has argued for the importance of a third major player with the example that Sprint's leadership in 4G has forces AT&T and Verizon to speed up their 4G rollout timetables-to the benefit of consumers. "Sprint is pro-competitive," Hesse said during the carrier's April 28 earnings call, "and our investment thesis is that all boats will float higher in a vibrant and innovative industry-especially an industry that has the unbridled potential of wireless."