On Wednesday, T-Mobile began a three day campaign designed to unveil its new entry-level plan that allows customers the opportunity to get a phone without a contract for only $40 a month. The $40 includes unlimited talk and text, as well as 500MB of 4G LTE data and will be called the ‘Simple Starter’ plan.
One important factor about this plan is that it says that there will be no “overage fees for customers who go past their allotment.” T-Mobile’s chief marketing officer, Mike Sievert, said "Right now at the value segment the deals that are out there are outrageous. We're not going to treat customers in the value segment as second-class citizens. It’s a bait and switch. Typical customers will easily pay double that.”
The last comment is in reference to AT&T and Verizon’s inexpensive plans. T-Mobile talks about the fact that data limits are so low and the overage fees so high that many customers will just be facing larger bills.
At $40, the plan is $10 cheaper than the lowest priced "Simple Choice" plan, which charges $50 for double the data at 1GB. This new plan will become available on April 12.
When discussing the overage fees that other companies charge, T-Mobile states that for those who do require more data, they can purchase a day or week pass, or upgrade to one of T-Mobile’s Simple Choice plans which start at $50.
Maybe it is just my cynicism, however while T-Mobile doesn’t believe that many people who are opting for the Simple Starter plan will actually require more data, is it not a fact that once people start experience what they can do that they will want to do more. So while it may not be a bait and switch tactic, doesn’t it still count as a “reel them in” tactic? Once you have them, they will want more.
T-Mobile is basically extending its Un-carrier plan as a strategy towards entry level customers. T-Mobile said this new plan also qualifies for the company’s program where it pays the early termination fees for switchers that come from another carrier and trade in their old phone.
In his reserve and quiet way, T-Mobile CEO, John Legere said, "Just look at the frenzy of knee-jerk moves the competition launched in recent weeks. It's been fascinating to watch the big, fat, old-guard carriers stumble as they try to respond and slow the change we are driving into this industry. I don't know whether to laugh or cringe as they try to present themselves as anything other than the merciless, greedy utilities they are. They must be thinking that we are done, because they've thrown a ton of money at short-lived promotions that come and go, and they've rolled out painfully lame knock-offs of Un-carrier innovations like our JUMP! upgrade program. Pay twice for your phone? (I'm looking at you, AT&T)."
Edited by
Stefania Viscusi 
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