The company adds more data to its Simple Choice plans at no extra charge, as competitors nip at its heels and customers increase usage.
T-Mobile is offering its customers a free data upgrade.
The company announced Friday that it is doubling the amount of data customers can use per month on its standard 4G LTE service plan for no additional cost. So instead of getting 500MB of data per month at the full 4G LTE speed for $50 a month, users will now get 1GB of data. (All Simple Choice plans also come with unlimited talk and text messaging.)
Customers who subscribe to the $60 a month plan will see their data bucket increase from 2.5GB per month to 3GB per month. The $70 a month plan, which used to offer unlimited 4G LTE usage and 2.5GB of data hot-spot usage, which allows users to turn their smartphones into mobile hot spots to connect other Wi-Fi enabled devices to the T-Mobile 4G LTE network, is changing. Now that $70 service will provide 5GB of LTE usage on the network. And a new $80 a month plan was added that will provide unlimited 4G LTE usage and 5GB worth of tethering data per month.
“When customers see their bill in April, they’ll see that their data has automatically increased,” T-Mobile Chief Marketing Officer Mike Sievert said in a phone interview Friday. “Everyone gets it automatically. There’s no signup or additional fee to switch plans. It will just be there, and not one single customer will pay more for it.”
Users also should keep in mind that unlike other data plans from major carriers such as AT&T, Verizon Wireless, or Sprint, once T-Mobile customers exceed their monthly data limits, they are not charged extra for usage. Instead, the speed of their connection is slowed, but they are still able to access the data network at no additional charge.
In addition to the increase in data, which will be added automatically for all Simple Choice customers, T-Mobile is offering customers free texting to phone numbers outside the US as well as free texting while traveling abroad on foreign networks in more than 120 countries.
Sievert explained that the data increase is just another example of the “UnCarrier” T-Mobile listening to its customers and giving them what they want.
“Our customers are using way more data today than when we introduced Simple Choice last year,” he said. “Data usage has grown 50 percent compared to a year ago on the Simple Choice plans. Customers are demanding more and using more data. So we’re listening to them and giving them what they want.”
Listening to customers has been what’s behind T-Mobile’s UnCarrier strategy from the beginning. But it’s also likely that T
Mobile is starting to feel the heat from larger competitors AT&T and Verizon Wireless, which have responded to T-Mobile’s UnCarrier moves with some data plan tweaks of their own.
AT&T and Verizon have each recently adjusted their plans to give customers more data for roughly the same amount of money. Verizon also has added new tiers of service that address customers looking for smaller buckets of data.
There’s no question that T-Mobile has shaken up the industry with its strategy. But the big question that looms is whether or not the company can keep doing what it has been doing and still make money. Softbank CEO and Sprint Chairman Masayoshi Son doesn’t think a small player such as T-Mobile or Sprint, which his company now controls, can take on AT&T or Verizon on its own.
He has already made it known publicly that Sprint wants to acquire T-Mobile in a move that would create a carrier that would nearly equal the size of either AT&T or Verizon in terms of subscribers. So far, regulators, who view T-Mobile’s bold moves via the UnCarrier strategy, as a sign that competition is working, aren’t keen on the idea.
Sievert wouldn’t comment directly on any specific acquisition rumors, but he noted that having enough scale to compete against the two big players is important in the wireless business.
“We have always said that we see further consolidation in the wireless market,” he said. “And under the right circumstances we think that would be pro-consumer. It will be very important for any carrier to be able to cost-effectively get a hold of wireless spectrum as it becomes available.”
In the meantime, T-Mobile plans to continue driving forward with its UnCarrier strategy. The company added a total of 4.4 million new customers in 2013, of which about 2 million were postpaid customers. Sievert said he doesn’t see the company slowing down in its drive to add new customers. And during its fourth-quarter conference call, the company said it expects to add between 2 million and 3 million new postpaid customers in 2014.
“We are a value leader in the marketplace,” he said, “And we’ve been disruptive in our moves so far. This is another example of that. Customers are using more data, and we’re going to given them more data without them having to ask for it.”