T-Mobile Drops Low-Priced Plans, Moves to Unlimited Data
August 18 2016 - 11:20AM
Dow Jones News
T-Mobile US Inc. is dropping lower-priced monthly data plans and
replacing them with a higher-priced service offering unlimited
data.
The No. 3 wireless carrier said Thursday its new T-Mobile One
plan does away with its old model, which sells subscribers a
certain amount of data each month before data download speeds are
slowed.
"This is going to be our rate plan," Chief Executive John Legere
said during a conference call. "This is going to be very difficult
for AT&T and Verizon to do."
The new T-Mobile plan costs $70 a month for a single line, up
from $65 a month for six gigabytes of data or $50 for 2 gigabytes
under the previous plan.
Mr. Legere acknowledged the new plans could raise prices for
customers of the lowest-tier plans, but said customers looking for
cheaper plans can still buy less-expensive prepaid service or opt
for the company's MetroPCS brand.
In the new plan, a family with four phones would pay $160 a
month. T-Mobile said it most popular family package previously
offered four lines for $120 a month with speeds slowed after six
gigabytes of use per device. An unlimited monthly plan for four
phones previously cost $220.
The new plan will be available Sept. 6, at which point previous
plans will be phased out. Existing T-Mobile customers can keep
their current plans.
The move is the latest by wireless carriers that increases the
monthly cost for consumers while offering more data for a higher
price, a major shift away from the aggressive promotions and price
cuts in recent years. AT&T Inc. Wednesday outlined a new set of
plans that raised prices on the lowest-tier data plans, dropped
overage fees while lowering rates for the biggest data users.
T-Mobile already offers video and music services that don't
count against their customers' data plans.
The new T-Mobile offer comes with caveats. All video is
typically streamed in a standard-definition format. As with earlier
plans, T-Mobile plans to restrict users who use the most data—about
26 gigabytes a month—by shifting their wireless traffic to the
lowest priority when the network is congested. A subscribers who
use a smartphone as a wireless hot spot to beam internet service to
a computer will see bandwidth slowed to second-generation
speeds.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com
(END) Dow Jones Newswires
August 18, 2016 11:05 ET (15:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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