Third-ranked US wireless carrier T-Mobile has announced a radical restructuring of its rate plans that includes the elimination of annual contracts, in a move that CEO John Legere says is designed to address consumer frustration. "This is an industry filled with ridiculously confusing contracts, limits on how much data you can …
I only take a contract with phone when it works out cheaper than phone + Contract over the 24 months..
I assumed everyone did the calculations before buying? or am I one of the few who can do basic maths?
But for those who can't do basic maths this is a good thing!
We do but it changes market to market exactly how simple the calculation is. The maths is simple but comparing the service often isn't. You have to start looking at
-do I get roaming
-can I get the same phone (quite a few payg month to month providers have a restricted range of phones and don't allow byod)
-do I start to have to pay to phone customer services
-do I end up paying more for data
-do they offer handset protection
-do I get 4g or am I stuck on 3g
I agree it's always worth looking at the sums, but it is also important to look at if there are any feature changes between contract and non contract plans. There may not be, but there often are.
I'm getting quite close to the point where I just buy a hotspot with a decent battery life and just use a tablet \ phablet and skype for the rare times I actually need a phone to be a phone.
Mobile phone contracts <> basic maths!
Take a simple scenario: small business, a dozen users, mostly UK usage, some business trips to EU and some beyond inc a fortnight in China once every few months. Voice and text and data usage varies from user to user, and is likely to vary in the coming year. iPhone and Android considered. O2 and Orange/EE considered. Need access to company e-mail/calendars on Exchange. A couple of users have contracts not ending at the same time as others.
Even getting the basic tariff *facts* is a month-long struggle. Summarising it in a form which decision-makers can assimilate ...
I have a degree in Maths. This is what we like to call a "non-trivial" task :)
Having said that I do detect a welcome move to "unlimited" tariffs at moderately sensible prices. £30pm from Orange/EE with almost-nil-cost iPhone, "unlimited" voice+text+data. If users use the "unlimited" mobile voice instead of using the office phone system, this looks promising.
Shake it up
I welcome T-Mobile trying to shake things up in the cell phone market (there's basically no competition in the segment), but I'm a little unsure exactly how much influence they will be able to push. We are almost at the point nowadays where AT&T and Verizon are so big, there's not much that can be done to knock them off their thrones.
Will the iPhones be unlocked?
If so, I might switch to T-Mobile when it starts selling the iPhone. $580 is a good price for a handset that costs $650 from Apple, although maybe this is an indication that it IS locked.
Also I feel like switching just to express my distaste with AT&T and Verizon. Currently I'm using StraightTalk, which is fine, although it doesn't work with MMS on the iPhone, plus it occasionally doesn't let me connect to the internet (a problem which is usually and annoyingly resolved by turning airplane mode on and off a few times).
Re: Will the iPhones be unlocked?
In my experience, EVERY T-Mobile handset is unlockable, and they will readily unlock it for you on request.
The only caveats are reasonable ones to avoid intermediaries buying phones, unlocking them, and selling them on, which (in practice) T-Mo tends to implement them as "phone must have been activated on the network for 30 days or more", and "account must be in good standing"... BUT I have known them to waive the "30 days" bit.
Re: Will the iPhones be unlocked?
I was on tmob last year (ended up hating the poor coverage and loss of signal in larger buildings) and all our handsets were unlocked (to use them abroad) after a simple call to custard services. This was after a few months with them so still in contract, so no issues about that, if they are locked they should unlock them for you :)
One issue I noticed with tmob (although it could have been our phones) was that whenever you left their service area (and there were lots of gaps) it wouldn't register on at&t for roaming (it would see their network and get bars, just not register) and would require a full power off\on to get it to reregister on tmobs network. This was across 4 phones only 2 of which were the same model. Custard services weren't interested, they just said "oh it's probably that none of your phones support registering on at&t).
Re: Will the iPhones be unlocked?
I would not recommend switching to TMO if you have any plans to use your phone outside of a major metropolitan area. They provide their UMTS/HSPA service almost to the city limits, and outside of the cities their network is basically voice coverage, with "data" performance beyond bad.
We just took a cross-country trip, and at least once an hour we wanted to perform some seemingly simple smartphone type activity, like looking up the weather (WTF is it raining so bad right here), "how far does this traffic backup go", attempt to find a place to eat, rest stops, etc. In those scenarios we were completely unable to complete the task.
So the voice network was functional, and I called customer service to vent. Their response was that they recommended using WiFi wherever possible. I asked them how that was supposed to work... in the car. No answer for that. Their "data service" is nearly superfluous, like I'm paying them but not getting anything for it. If I had planned to use WiFi, then I'd get an iPod touch and save the monthly charges. So the CSR agreed and knocked off half my data plan charge for the month.
I'll also recommend checking out "opensignal", a self-reported coverage map site. With some work you can see what their 3G UMTS coverage is and where it isn't. Never mind LTE.
T-MUS have imported the EE model. Interesting to see if other T subsidaries follow.
What's an 'EE model'?
Everything everywhere's "All you can eat calls/text, just pay for data" business model.
4th carrier in US
Not to quibble, but T-Mobile is 4th largest carrier behind Sprint...and way behind the giant AT&T/Verizon duopoly.
Given my experience, T-Mobile and the new iPhone pricing, will initiate giant churn at AT&T & Verizon...if they don't react & lower their confiscatory pricing plans.
Customers in US are either too lazy to discern the handset subsidy built into the 2-yr monthly phone contracts (and/or too poor to pay the unlocked price), so T-Mobile has had to shout it out, at a NYC keynote event (while the tech press have been happy to never point it out for the last 5 years). The pricing plans are quite cheaper (with less trap-doors for bill shock).
Note that T-Mobile is the only carrier that offers a lower price for an unsubsidized handset. Clearly, AT&T & Verizon have been raping & pillaging with glee.
Given the spectrum monopolies (and SIM-locking) sanctioned by the captured FCC here, all handsets are unusable on the different carriers anyway (Verizon & Sprint: CDMA; AT&T & T-Mobile on disparate-band GSM, so monopoly pricing abounds.
This is changing now with the re-farmed spectrum that was handed over to T-Mobile, after the AT&T buyout was blocked recently. The tweaked iPhone 5 model that will add AWS-band, will now work between LTE on T-Mobile & AT&T (along with T-Mobile's current 42 mb/sec 3G HSPA+ band). AT&T's GSM iPhone exclusivity since 2007, is finally at an end here.
The idea of the T-Mobile bill amount being reduced, after the iPhone subsidy is fully-paid will astonish phone customers, because AT&T & Verizon have gladly never lowered their bills when contracts expire.
My guess is offering unlimited 3G data -- and merely throttling after your HSPA+/LTE data cap is exceeded -- will allow interesting smartphone app usage, given no more bill shock and overage charges.
Fair-value trade-in for iPhones with no-contract pricing (and $80 cheaper than Apple's unlocked handset pricing) will also allow everyone to upgrade to new iPhone 5S/6 (or new Androids, Blackberrys, WinPho) immediately, as well.
No surcharges for tethering, FaceTime over cellular and easier SIM unlocks for international traveling will be welcome also.
Well done, T-Mobile; six years of nightmarish bills of $100/month (+ overages + 90-minutes customer svc calls to AT&T or Verizon) for SIM-locked iPhones, have finally come to an end in the US.
TMO is pretty awesome, with Spring right behind it...
...and I fear for my great TMO network, I don't want all the iDroids flood it...
"few who can do basic maths"
Here in the US, not only can the people not do the basic math, 80% of them don't even understand what a no-contract/unlocked phone *is* - just like they don't understand the difference between "Android" and "Galaxy" or what "Motoblur" and "HTC Sense" are.
When I bought my Nexus 4 direct from Google, and left Verizon for PAYG with T-Mobile, people's heads exploded. "What? You can do that?"
They didn't understand how I could cut my monthly bill in half without a contract, and get a better data cap to boot.
People in the US are *clueless* about mobile phones, and the carriers know it, and take full advantage.
Re: "few who can do basic maths"
Yep. Once upon a time back in the early 90s I had a friend from the UK stay over and he was astounded at my internet connectivity - 33.6 dialup, free access (OK, I worked for an ISP so we can discount that one), and my calls were free. I explained I just got a bill every month, then paid it. Then he started telling me how things worked "back home" and I was aghast.
20 years later and the script got flipped. The horror stories he told about landline service in the UK now apply to mobile service here in the US, and the "here's your phone, pay your bill" dream is now worldwide on wireless devices.
Re: "few who can do basic maths"
Yeah. People are clueless. I bought a lumia 920 unlocked for 680 and and signed up with tmobile no contract plan here in the US. When I tell people, they think I'm nuts. But then I ask how much they paid for their phone and how much they pay a month and I'm saving around $800 in a two year period. Not bad at all.
Contracts are awful, it locks people in, takes away their freedom to leave, and they end up spending more in the long run. It only looks good on the surface.
Re: "few who can do basic maths"
Why are plans so expensive in the US?
eg. T-Mobile, phone + 1 line monthly plan (no 4G) would come to ~$2000 over 2 years.
An almost identical contract plan in the UK would come to ~$1400 over the 2 years.
Re: "Why are plans so expensive in the US?"
Mostly because people don't take the time to shop and match a plan to their needs.
I use Ting (MVNO on Sprint's network) and my phone bill last month for two phones (Nexus and Sprint Epic 4g) was $39.00 plus about $3.00 in taxes. Granted I don't use a lot of voice or data - that rate gets me 300 minutes of voice and 500GB of data shared across both phones - but the point is, it's a no-contract, pay-for-what-you-use plan and it's a whole lot less expensive than any other carrier. On Ting if you use more you pay more (what a concept!), and they automatically adjust your plan up and down each month.
There are decent plans out there if you take the time to look.
(No affiliation with Ting, BTW, just a happy customer that appreciates the value they offer. YMMV)
Re: "few who can do basic maths"
Thank you for your thoughtful comment! We are so lucky to have someone such as you to ,smugly point out our ignorance and remind us of your superior intellect. We truly appreciate your self appointed representation of all 300 million of us. I just don't know how we could manage without your insightful comments concerning our concentrated national lack of intelligence. I'm sure your friends talk glowingly of you in your absence unlike the unnamed person they refer to as a "pompous ass" who "thinks he is so smart" and "a legend in his own mind". I don't know who they are referring to, but I bet if you give it a moment's thought, you do.
It will be interesting to see the response to this in the US
I know several people who were shocked when I told them how much cell phones actually cost, versus the $99 or $199 phones they see. I guess they think the $0 phones were free just to get you to sign a 24 month contract with them.
I think there will be a lot of people suspicious of this and thinking T-mobile is trying to rip them off offering to sell them an iPhone for $99 plus $20/mo for two years when they can get one for "only" $199 from AT&T or Verizon. Yes, if they can do basic math they'll see they still come out ahead, but the problem is they'll go into it thinking it is some sort of scam. The math making sense will only make them believe they just don't see what the scam is, and back away.
I hope I'm wrong, because I'd really like it if all carriers switched to this model. I'll bet that unless I'm wrong and this works for T-mobile to steal customers from AT&T and Verizon they'll just ignore it and keep doing what they've always done.
"$580 is a good price for an [iPhone5]..."
Wow, for a throwaway device?! Can't get my head round the prices for soon-to-be-obsolete smartphones....and peoples' willingness to fork it over so easily.
8yrs ago my Sidekick was -$50 (T-Mobile), the HTC EVO 4G was $199 (Sprint), and the unlimited data plans were cheaper than T-Mobile has in this story (negating the arg that the cost of those phones was added into the monthly bills).
I was waiting for pricing on the new S4, and ideally from TM, but it sounds like it'll be $500+ and nearly $100/mo for equivalent unlimited 4G service I get today.
Anyone feel that overall the costs are just going up and up and up - just like "tv" bills have over the years?
(before the Sidekick I had a basic Nokia phone with unlimited calls - no data - for less than $20/mo......just feels like endless "bill creep" to me).
T-Mobile USA (not to be confused with other T-Mobiles that I've had the misfortune of dealing with aka one2one), have been providing excellent service since I've been dealing with them... for a PAYG customer, once you top up with $100 of credits, you become a "gold rewards" customer, here's a copypasta of the "gold" customer text:
What is Gold Rewards status?
With Gold Rewards status, you automatically receive 15% more minutes for free, and any unused minutes won’t expire for a full year!
How do I qualify for Gold Rewards status?
To qualify, spend just $100 (in any combination of $10, $25, $50, or $100) in T-Mobile refills for your Prepaid phone.
When will I get my bonus minutes?
Gold Rewards minutes are received on the NEXT refill card you redeem after you have officially qualified. More specifically, you will receive bonus minutes on the refill card redeemed after the one that carries you over the $100 refill mark.
Can I ever lose my Gold Rewards status?
Yes. To maintain your Gold Rewards status, you must keep your Prepaid account active. Activating a new line of service will result in the loss of your Gold Rewards status.
Same in UK
The lack of understanding is every bit as common in the UK, although obviously not so much on a tech site such as el reg.
I just bought a Nexus 4 (£279), cancelled my previous contract and got a T Mobile sim only contract for £16 p/m, unlimited calls, texts and data.
Almost everyone who asked what I was paying for the new phone were convinced that their 24 month contract with 100-200 minutes and 500mb data for £41 p/m was better because "the iphone 4 only cost £100".
I guess the biggest barrier to people is paying upfront rather than paying it gradually, at least the new model is transparent!
People don't care what the overall cost is as long as carriers keep giving them phones they can't afford.
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