Unlimited plan with no contract costs $79.99 monthly
The mobile phone industry is very
competitive with new plans by one company often matched by other
major providers in a short period of time. When the first unlimited
plans showed up, most other providers began offering their own
unlimited plans as well.
Of the major wireless carriers, the
smallest is T-Mobile. While the company is quietly cornering the
market on cool Android handsets like the HTC
Hero, it is still losing customers to smaller unlimited pre-paid
carriers and larger carriers like Verizon and AT&T.
Reuters
reports that T-Mobile has unveiled a new no-contract
option for customers. The new unlimited no contract plan will
cost users $79.99 per month for unlimited talk, web, and text
messaging. The price is 20% less than what contract users pay,
however, there is one significant tradeoff to go sans contract.
The
mobile phones on the contract-free plan will cost more. Exactly how
much more is unknown, but odds are the devices will sell for close to
their full retail price. Subsidies often knock hundreds of dollars
off the price of a mobile phone in exchange for a long-term
contract.
The unlimited plan for those on a contract costs
$99.99 per month, but the subsidies make the phones significantly
cheaper. Many analysts had expected T-Mobile to offer an unlimited
plan at only $50 per month reports Reuters.
"In
our opinion, the new plans are more benign than investors' initial
fears and could relieve some pressure on wireless stocks," Piper
Jaffray analyst Christopher Larsen said in a research
note.
Executives from Verizon told analysts on an earnings
call that it did not feel compelled to offer a similar service to
what T-Mobile has announced.
"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer
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