Can This T-Mobile Plan Ding Verizon and AT&T?
T-Mobile has shown it is willing to make bold moves in the past. With MetroPCS under its belt and stock trading on a New York exchange, the company is now looking to convert subscribers with very attractive no-contract plans. The best of all could pull customers from AT&T (NYSE:T) Sprint (NYSE:S) and Verizon (NYSE:VZ).
T-Mobile’s best plan costs $30 and delivers 5 GB of data on 4G networks, along with unlimited texts and 100 minutes of calls. The rate is available for new T-Mobile customers and making some noise, considering comparable service from Verizon isn’t close to this price point. In the coming week, Verizon will respond by upgrading its $60 plan — which formerly came with 500 MB of data — to 2 GB. Yet it’s still double the price and a mere 40 percent of the data allowance T-Mobile delivers. AT&T comes in at $65 for 1 GB of data, while Sprint offers unlimited data for $70 a month.
Users coming from other carriers will need a T-Mobile SIM card (or a new phone) to pull off the transition, as well as the ability to navigate a website that doesn’t make it easy to find this incredibly cheap deal (Danny Sullivan of CNET describes the process in detail). However, for the visitor’s efforts, the new plan will deliver at least 50 percent in savings for a significant data allotment. Despite the fantastic price point, the reputation of T-Mobile’s network might precede it.
Users have often remarked on the unreliability of T-Mobile when traveling outside of urban areas. CNET‘s reviewer reported decent service in suburban Minnesota, noting only slightly less consistent speeds. His biggest problem was actually getting the deal. It would be in T-Mobile’s best interest to make access to the plan easier, now that it has spectrum to burn following the MetroPCS deal.
The biggest indicator of success in T-Mobile’s strategy is the quadrupling of data allowance by Verizon in its $60 plans. Even if T-Mobile can’t win back the customers it lost prior to getting the iPhone on its roster (it did sell 500,000 iPhones in May), there is still promise with its new appproach. Since its May 2 debut, T-Mobile stock is up 30 percent and considered overweight by many analysts, with upgrades likely ahead in the coming weeks.