3/28/2013 5:11 PM ET|
New T-Mobile plan not right for everyone
The carrier's new iPhone offer still means a long-term commitment, but it could save you money.
T-Mobile this week rebranded itself as the "uncarrier" by doing away with cellphone contracts. The company also announced it will add the iPhone to its smartphone roster in April.
No contract? Really?
If you're buying the phone from T-Mobile then you are under contract, notes Jordan Crooks of TechCrunch, who called the announcement "a marketing move."
"By tying the contract to your phone and not the service, the carrier instantly differentiates itself from the competition," Crooks says.
One major difference: Once the phone is paid off, your cell bill will drop by $20 per month.
Is that cheaper than competing carriers? Hard to say, since consumers' needs and speeds vary so widely. For every gearhead who needs the latest-generation everything and constantly texts and streams video, there's a tech slowpoke like me still using a 5-year-old flip phone for voice calls only.
Apples to apples?
In a post on Wired.com, Christina Bonnington says the T-Mobile plan is "totally comparable, if not better, than current alternatives." The accompanying chart shows total two-year costs as follows:
- T-Mobile, $1,780
- AT&T, $1,640
- Verizon, $2,120
- Sprint, $2,120
This isn't a straightforward comparison because the four companies' plans vary. For example, AT&T's plan is for 300 MB per month and pay-as-you-go texting versus T-Mobile's 500 MB plan with unlimited texting. If you want the phone just for straight calling, then AT&T would look like a slightly cheaper deal -- except that AT&T charges extra for voice.
T-Mobile's biggest issue is probably not price, but coverage. According to New York Times reporter Brian X. Chen, the company has steadily hemorrhaged customers due to "negative perception of its network and its inability (to offer) the iPhone."
Soon it will have the iPhone -- but will it have the network? Currently T-Mobile offers the advanced fourth-generation LTE network in only seven markets but is working to expand the coverage.
Jessica Dolcourt of CNET notes that T-Mobile's backup network, known as HSPA+ 42, is "a very quick network in its own right" and should suffice as T-Mobile rolls out the more advanced LTE coverage.
The writer also commends T-Mobile's offering of unlimited 4G FaceTime (video) calling with its $70 plan, and the fact that the iPhone supports HD Voice.
However, it won't allow Wi-Fi calling, i.e., free calls over broadband. The company's chief marketing officer "hinted that it could arrive later," Dolcourt says.
What works for you?
Negative perception of network coverage could be hard to shake, especially since the other three carriers are so far ahead with their 4G networks. Additionally, consumers who want to buy the phones may consider the "no-contract" concept a bit misleading: If you can't walk away free and clear at any time, then it is a contract.
The New York Times points out that cheaper plans already exist through smaller carriers, such as Virgin Mobile's $30 plan: 300 minutes, unlimited data and unlimited text messages. It also notes that after two years "most consumers" will want to upgrade their phones anyway.
Those of us with aging flip phones or older-model smartphones beg to differ. Some can't afford to replace regularly, and some don't want to: We just want to be able to make calls or do some basic Web browsing.
The uncarrier might save you money if you already have a phone, or if want to buy one from T-Mobile and keep it for a while -- or maybe buy it outright and then head off to a cheaper service provider. Do what works for you, and don't switch carriers until you've done your own comparisons and your own math. Lots of it.
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