T-Mobile Improves Unlimited Plan After Competition From Verizon
As analysts, investors, and executives in the telecom business debate the growing impact of unlimited data plans, one winner is becoming increasingly obvious: consumers.
The original low price T-Mobile (TMUS) unlimited plan, introduced in August and known as T-Mobile One, downgraded all streaming video to phones from high-definition to DVD quality. Higher quality video streaming was available for a higher price, $3 per day or $15 per month. On Monday, CEO John Legere announced on Twitter that T-Mobile would stop downgrading video and give all its unlimited users HD video for no extra charge.
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Also, the plan had previously limited sharing data from a phone with other devices like a tablet via Wi-fi tethering to slower speeds of up to 512 kilobits per second. Unlimited high speed tethering was available on a plan that cost an extra $25 per month. But Legere said T-Mobile would now match Verizon’s deal of 10 GB per month of full LTE speed tethered data.
T-Mobile’s plan still starts at $70, $10 less than Verizon’s plan, and eliminated added fees and taxes in January, which can boost the final price to a Verizon customer by 10% or more. But T-Mobile cut the price of a two-line plan to $100 from $120. Verizon (VZ) charges $140 plus taxes and fees for two lines. Sprint (S) this week slashed its unlimited price to just $90 for up to five lines for a year. So far, AT&T (T) has not changed the price of its unlimited plan, which starts at $100 and is only available to customers who also subscribe to its DirecTV service.
Despite all the new customer-friendly competition, the return of unlimited plans could hurt users in the end, if all of the recent moves lead to excessive network congestion. T-Mobile, Verizon, and other carriers have been adding new technology and more cell phone sites to improve efficiency and capacity in their networks. But with consumers watching ever-more streaming video on the new plans, analysts aren’t sure whether the upgrades will be enough.