Earlier this year, reports began to surface that T-Mobile USA was looking to officially offer the iPhone. By this time, the company had already confirmed its plan to end smartphone subsidies, which binds subscribers to a 1 or 2 year contract with the company in exchange for a lower or ‘subsidized’ price on a phone. Apple also confirmed to The Loop that T-Mobile would carry its products but did not specify which ones. According to mobile news site TmoNews, T-Mobile is planning to make drastic changes to its service this month, including the elimination of contracts and early termination fees.
-For starters, kiss contracts goodbye as T-Mobile moves to a no-contract world. Existing customers will finish out their current contract or upgrade to a new device without a new contract, whichever comes first. New customers won’t have to suffer with any long-term commitments. Contract wise that is.
-Early termination fees will be a thing of the past as well, which makes complete sense when announced with the removal of contracts.
-Expect the introduction of a new equipment installment plan tier, likely in the $25 – 30 dollar range as T-Mobile moves to make all its smartphones $99 or less as down payments. A $30 tier makes sense if you consider the retail value of the device is $699 = $30 x 20 monthly payments.
T-Mobile is the fourth major carrier in the United States, after AT&T, Verizon and Sprint. In late 2011, AT&T was looking into acquiring T-Mobile but the plans were shot down by the Federal Communications Commission and the Department of Justice. Since then, relations between the two companies have soured, with AT&T launching a full-page ad in The New York Times, The Wall Street Journal, and USA Today, slamming the company.
The ad specifically notes that T-Mobile’s network has twice as many dropped and failed calls, and half the data speed of AT&T’s network. The ad campaign is said to be a response to T-Mobile CEO John Legere who mentioned earlier this year that AT&T’s network was “crap”.
It is not surprising that carriers are launching attacks at each other, particularly when Apple’s products are offered on multiple networks. If T-Mobile does get the iPhone, tt will be interesting to see how it fits it into the no-contract structure, which is usually seen with regional carriers such as MetroPCS or C-Spire Wireless.