T-Mobile today announced the iPhone 5 would be available for purchase on their network beginning on April 12th for $99 down and 24 monthly payments of $20. The net cost over the duration is $579. Their CEO took a rather unconventional presentation style, using expletives to bash the traditional carrier pricing structure that relies heavily on contract based subsidies. Using the iPhone 5 as an example, you would pay $100 more going to AT&T or Verizon. This $199 price for the phone is subsidized through the life of a 2-year contract. T-Mobile’s iPhone 5 is technically contract-free, so you can leave the service, but still need to cover the cost of your monthly payments for the hardware.
The T-Mobile iPhone will support their growing LTE network, available in seven major metro areas including Baltimore, Houston, Kansas City, Las Vegas, Phoenix, San Jose and Washington D.C.
As for plans to go with your new contract-free iPhone 5, T-Mobile has just one, the Simple Choice Plan.
Base rate of $50 per month for unlimited talk, text and Web with 500MB of 4G data. Consumers can add 2GB of 4G data for $10 per month per line or get unlimited 4G data for an additional $20 per month per line. Customers can add a second phone line for $30 per month, and each additional line is just $10 per month. There are no caps and no overages.
One feature that is unique to T-Mobile is support for HD Voice, a feature that delivers crystal-clear high definition calling, while reducing background noise. This is not available on either AT&T or Verizon.
Customers can also use T-Mobile’s Smartphone Mobile Hotspot for free up to 500MB. A nice feature for those who want to tether their iPad, MacBook or laptop.
Like AT&T, the T-Mobile variety of the iPhone 5 supports talking and surfing.
In addition to the iPhone 5, customers can purchase the iPhone 4S, though I’m not sure why someone would opt for that option. The iPhone 4S pricing is $69.99 plus 24 payments of $20 for a total net cost of $549. It would be relatively insane to pay $549 for an iPhone 4S, when you can pick up an iPhone 5 for $579.
T-Mobile is struggling to keep customers. The addition of the iPhone 5 certainly won’t hurt them and the $99 price will attract customers looking for a lower entry cost to an iPhone. At first glance, T-Mobile’s plans seem attractive as compared to AT&T, but the savings over the 2-year period won’t be as epic as T-Mobile will have you to believe. How and when you pay your phone has changed. We’ll see if that’s enough to entice customers and you have to give T-Mobile credit for shaking things up.
How about you? Are you ready to jump ship and shift to T-Mobile? If so, why? Let us know in the comments.