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T-Mobile on Wednesday introduced a new entry-level $40-per-month plan that includes unlimited talk and text along with 500 megabytes of high-speed data.

Unlike other T-Mobile plans, the Simple Starter option doesn’t throttle users down to a slower speed when they hit the limit. Instead, customers are prompted to buy a day or week pass or switch to one of the company’s standard Simple Choice plans.

T-Mobile said the new plan also qualifies for the company’s program where it pays the early termination fees for switchers that come from another carrier and trade in their old phone.

“Right now at the value segment the deals that are out there are outrageous,” chief marketing officer Mike Sievert said in an interview.

While AT&T and Verizon have plans close to that price range, T-Mobile says the data limits are so low and the overage fees so high that many customers will face larger bills.

“It’s a bait and switch. Typical customers will easily pay double that,” Sievert said. “People need to call them out for this.”

T-Mobile said it plans to have more news each day for the next three days, promising news tomorrow for another segment of the market.

“We’ve been a little quieter lately,” Sievert said. But those who thought the company was done shaking things up, Sievert says, “were far from correct.”

In a blog post, CEO John Legere teed off on the company’s rivals.

“Just look at the frenzy of knee jerk moves the competition launched in recent weeks,” Legere said. “It’s been fascinating to watch the big, fat, old-guard carriers stumble as they try to respond and slow the change we are driving into this industry. I don’t know whether to laugh or cringe as they try to present themselves as anything other than the merciless greedy utilities they are.”




4 comments
EJJacob
EJJacob

In my view T-Mobile is just like AT&T, Verizon, Sprint etc.   I started using Ting a year ago, and my AVERAGE bill for the 11 months since I started using it has been under $30!   (Yes - Ting is a wholesaler for Sprint - but their customer service is light years ahead of Sprint, and the rest of them).   I like them - no contracts, commitments or agreements - you just pay for what you use - what a novel idea!   Full disclosure - I have no relationship with any telco, either financially, commercially, or any other way.

michaelant
michaelant

A far more useful "Simple Starter" plan would be unlimited data, along with 30 minutes of talk and 30 SMS texts.



T-Mobile may brag and agitate about how they are shaking up the industry, but they're still constraining customers to plans that offer packages tilted to industry advantage. Data is far more useful for most customers. With adequate amounts of data, talk and text become irrelevant. Text is already irrelevant for many(most?) customers who use messaging services that ride upon data. Nearly all younger customers and/or tech savvy customers forgo talk for text/messaging, as well. Do something truly revolutionary, T-Mobile.

kungfumassa
kungfumassa

Not clear what happens when a user runs out of data. I see they get a prompt, but does data freeze up until the next cycle?

michaelant
michaelant

@EJJacob  Yes! I'm headed for Ting as well (after I verify coverage). Just waiting for my ETF to decrease enough with AT&T. 


Ting, as far as I can tell, is the ideal carrier. You bring or pay for the phone upfront, and then they fit their very flexible plans to what you actually use - yes, they credit you if you don't use as much as you thought you would - amazing. And the cheapest plans are truly just a few dollars, so you come very close to paying only for your actual usage.


T-Mobile, where you also buy the phone upfront, has NO justification for not allowing you to pay just for what you use. Their minimum plans are too high for some users. Only use $10 worth of stuff one month? Well, it's $30 anyway. Also, even the concept of a plan is a scam designed to part you from your money. What if your use varies month to month? Well, if you aren't psychic (and obsessive) and also change your plan each month, you're going to pay too much. Pay for more than you used if you didn't use much, OR, pay overage charges if you went over your plan. Customer always loses. House wins.

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