T-Mobile has been getting crushed of late, when compared to its national wireless competitors of AT&T, Verizon, and Sprint. T-Mobile lost 205K post paid customers in 2Q 2012, which was 4X what they lost in 2Q 2011. In 2Q 2012, Verizon and AT&T added 888K and 320K respectively. Something had to give. Today, we found out what it is – an unlimited data plan.
With their Unlimited Nationwide 4G Data plan, T-Mobile joins Sprint as the only two nationwide post-paid focused carriers with unlimited data plans. Over at CNET, Roger Cheng does a great job of comparing Sprint and T-Mobile’s unlimited plans, including comparing their pricing strategy.
“We’re big believers in customer-driven innovation, and our Unlimited Nationwide 4G Data plan is the answer to customers who are frustrated by the cost, complexity and congested networks of our competitors,” said Kevin McLaughlin, vice president, marketing, T-Mobile USA in a press release. “Consumers want the freedom of unlimited 4G data. Our bold move to be the only wireless carrier to offer an Unlimited Nationwide 4G Data plan reinforces our value leadership and capitalizes on the strength of our nationwide 4G network.”
I suspect Sprint may feel a more immediate impact from this move than Verizon and AT&T. Both AT&T and Verizon have weathered the unlimited data plan competition pretty successfully. It’s hard to imagine T-Mobile’s move having a material impact on them. But it may be a different story for Sprint. It’s not by accident that McLaughlin’s PR team chose the wording, “…the only wireless carrier to offer an Unlimited Nationwide 4G Data plan.”
T-Mobile uses the term 4G loosely, since it’s really a HSPA+ network that offers much faster download speed than traditional 3G networks. HSPA+ is better characterized as a 3.5G technology, but most people recognize that customers could care less about these technology debates. The more important issue for Sprint is T-Mobile has that network widely deployed – covering 220 million people across about 230 markets. That’s a far greater reach than Sprint’s 4G LTE efforts, which currently is in less than 20 markets. Sprint has all but abandoned its 4G WiMAX network, so it really doesn’t come into play. For the time being, Sprint has to rely on their 3G network to compete in the wireless data wars.
So in the short term, the two wireless unlimited data plans pit T-Mobile’s faster “almost 4G” network against Sprint’s legacy 3G and growing 4G LTE network. The market will decide which offers the better unlimited data value.
All may not be lost for Sprint though. They may have something that trumps T-Mobile’s apparent advantage in this battle. Namely the forthcoming iPhone 5, which most believe will be LTE capable. It’s a potential game changer that Sprint may be able to use to considerable advantage. Stay tuned.