09 August 2014

T-Mobile declares jihād.

When AT&T lost their bid to capture T-Mobile and handed over a check for 4 billion dollars, little did they know the monster they had just created.

First, they spent those free dollars to successfully upgrade their continental U.S. coverage and LTE speeds. With open bandwidth they offered $30 per month unlimited data/text pre-paid plans. Then they allowed customers to upgrade devices whenever they want. Next they abandoned contracts to allow customers to come and go whenever they want. Still not content, they offer to pay Verizon and AT&T early termination fees and trade in phones. They shocked iPad junkies with free data every month to GSM equipped laptops and tablets. People traveling overseas hate paying high prices, so they include international coverage for no additional cost. They hear customers complain about data overage costs on smart phones, so they give free unlimited 3G-equivalent speed after the LTE data is used up and start handing out free audio streaming.

Yes, Verizon and AT&T are doing their best to keep up, but the Black Knights threat of biting knee caps with tiny discounts does not hide the wounds. Unless you live in Alaska (the playground of Native Corp sponsored carriers you have probably never heard of), you are literally throwing money away by being on any other carrier. Even brilliant tech writers, who personally live in carrier contracts, like Maggie, are typing the virtues of jumping ship.

Sure, millions of people are flocking to T-Mobile, but that is not good enough for this terrorist carrier. Now they offer a family plan where you can cover four cell phones with unlimited data, talk and text for $100 per month - and just $10 for each additional line. Kaboom. I keep expecting the voice from Mortal Kombat to shout on the T-Mobile web site: "Finish them."

Even when looking at a $100 per month family bill, you are only seeing a small part of the savings. Remember those millions of people who lost their homes not realizing that low monthly payment would balloon on them? When you run out of data on Verizon or AT&T they will start charging you even more. When you go overseas, Verizon and AT&T charge a fortune for even looking at your phone. No wonder T-Mobile is the only one brave enough to abandon contracts. If we look at just two examples:

  • Verizon: 4 Moto X 16 gig devices ($1920), 4 people staying within data limit ($3840) = $5,760
  • T-Mobile: 4 Moto G 16 gig ($796), 4 people during 24 months ($2400) = $3,196
    • Save $2,564 on T-Mobile

  • Verizon: LG G3 ($2879), 4 people going over data limit ($4800), 3 tablets ($720) = $8,399
  • T-Mobile: Nexus 5's ($1399.96), 4 people going over data limit ($2400), 3 tablets ($0) = $3,800
    • Save $4,599 on T-Mobile

Add in some international traveling and with savings like this you might be able to buy Sprint, the entire corporation, at the end of a couple years. So, what's the catch?

The one thing everyone falls back on is "well, T-Mobile's coverage is spotty". It used to be, but my experience has shown that the gaps are no more severe than Verizon or AT&T and their performance is vastly superior to Sprint in the lower 48. Yes, if any carrier has bad coverage where you need it then you should look elsewhere. If you live in Alaska you have little choice but to buy AT&T, GCI or ACS. But do not base your opinion on Ralphie visiting your house in 2012 with a T-Mobile phone. Go online or visit a store and they will loan you a smart phone to test.

Regardless of coverage issues, the handwriting is on the wall for Verizon, AT&T and Sprint. Customers are moving in record numbers and unless they start offering similar no-contract plans with the ability to bring in low cost devices, T-Mobile's jihād might end with them conquering the cellular world.