Menu Menu

T-Mobile Goes Unlimited for $59.99; Simplifies Cell Phone Plans

T-Mobile completely overhauled their cell phone plans today, droppping 'myFaves' and simplifying to just 3 plans each for individual and family plans.   The highlight is a new low-water price point for contract unlimited voice service -- just $59.99 for one line and $99.99 for a two-line family plan.    All plans include unlimited mobile-to-mobile and free nights and weekends.    On a per-line basis, unlimited text messaging is $10.00.  The optional data feature is an additional $10 for regular phones, while the required data plan is $30 for BlackBerry and other smartphone devices.      At the same time, T-Mobile has launched an identical series of no-contract plans that are priced $10 ($20 for some family plans) less than the corresponding contract plan.     As with other no-contract and prepaid plans, you'll pay significantly more for the phone.    To compare the new contract plans with other carriers' options, visit our CellCalc rate plan comparison tool.

MyRatePlan Analysis: We've been forecasting that by the end of 2010, there will be just two voice plan options --a small bundle or pay-as-you-go for light users, and a flat rate unlimited voice for everyone else, with text and data as add-ons (probably marketed as bundled plans).  T-Mobile has taken a big step in that direction with these changes.     They've also addressed a pricing distortion in the marketplace, where contract unlimited service was $100 per month, while prepaid unlimited with services like Boost Mobile and Virgin Mobile is about $50 a month.   T-Mobile is now matching the $50 for no-contract service, and sets a price point for contract service that will force other carriers like AT&T and Verizon to respond.

Digging deeper into the changes, T-Mobile has actually raised some prices as part of these changes.  Data pricing for smartphones has increased $5 per line, while text messaging has been consolidated into a single $10.00/month plan.  Previously, there was a $5.00 plan offering 300 texts.  Since pay-as-you-go messaging remains $0.20 each, this will force more new customers to opt for a more expensive text bundle than they might have otherwise preferred.   The low-end $39.99 rate plan actually has fewer minutes now than before; this will also encourage more new customers to trade up to a more expensive rate plan.