5 Ways the New T-Mobile Is Stretching the Truth

There is something refreshing about T-Mobile’s new “un-carrier” strategy. The struggling No. 4 player in the U.S. wireless market has decided to ditch contracts altogether while separating the cost of the device from its new Simple Choice rate plans. Overall, consumers can save quite a bit of money versus AT&T, Sprint and Verizon. However, T-Mobile’s plans aren’t simple and straightforward as you might think, and there are plenty of caveats for every perk. Here’s a closer look at what subscribers are really getting — and what they’re not.

Correction: This piece was updated on April 5th to reflect that T-Mobile customers can pay off their phones at any time and that the unlimited data plan incudes 500MB of mobile hotspot service. In addition, T-Mobile does not throttle its unlimited plans. We regret these errors and apologize for any confusion.

White Lie No. 1: You’ll Save Over $1,000 versus AT&T!

If you trust T-Mobile’s marketing department, you’ll save more than a grand versus AT&T by opting for one of its Simple Choice Plans. But if you make comparisons based on what plans most people opt for on AT&T, the savings aren’t as great.

Let’s say you signed up for 2.5GB of data on T-Mobile for an iPhone 5. The phone costs $99 up front and $20 per month for the device for 24 months, plus $70 per month for unlimited data. Total after two years: $2,259. A similar AT&T Mobile Share plan with 4GB of data costs $110 per month when you add in the device access fee. That comes out to $2,839, or a savings of $580, which is significant but not mind-blowing.

MORE: 10 Smartphones You Should Buy Now

White Lie No. 2: No More Commitments!

T-Mobile says you “don’t have to serve a two-year sentence to get a new phone.” That’s true, but most consumers will wind up signing up for a 24-month payment plan, which is the same length of time as other carriers’ contract plans. The good news is that customers who choose the Equipment Installment Plan option can choose to pay off their device at any time and upgrade to a new device as you see fit. Plus, T-Mobile will let you trade in your old handset for “fair market credit.”

White Lie No. 3: It’s Unlimited Data!

It sounds too good to be true. The new base $50 plan for T-Mobile is unlimited, but it only includes 500MB of high-speed data. After that you drop down to pitiful 2G speeds. T-Mobile’s Unlimited Nationwide 4G Plan does include unlimited 4G data but only 500 MB of mobile hotspot service. An additional 2GB of hotspot service costs $10 per month. AT&T and Verizon include mobile hotspot with their shared data plans, and the cap depends on the amount of gigabytes you sign up for.

White Lie No. 4: You’re Paying a Lot Less for Phones!

Up front you are. The iPhone 5, for example, costs $99 down on T-Mobile but over those 24 months you’ll be paying $579 for the hardware. For not much more money you can buy an unlocked iPhone 5 ($649) and take it to AT&T or T-Mobile. Worse, T-Mobile is overcharging customers for the Nexus 4. You can pick up the 8GB version through the Google Play store for $299, while the T-Mobile version costs $49 up front but $457.99 when paid in full.

MORE: 10 Best Bargains in Tech Today

White Lie No. 5: Our 4G is Better Than Their 4G!

At T-Mobile’s launch event I was very impressed by the data speeds delivered by the Galaxy Note 2 and HTC One, with downloads ranging from 30 to 50 Mbps. The iPhone 5 was a little bit behind that. But this was on an unloaded network. T-Mobile says it has 50 percent more bandwidth than AT&T, which means less congestion, but seven launch cities puts T-Mobile way behind AT&T’s 161 markets and 486 for Verizon Wireless.

When you’re outside of T-Mobile’s LTE coverage, the carrier offers faster HSPA+ 42 speeds compared to AT&T’s 21 Mbps HSPA+ fall-back network. However, I’ve tested a number of T-Mobile phones in recent months that fall back to 2G in New York City and New Jersey. 2G! That never happens on Verizon and AT&T now, at least where I travel.

Editor-in-chief Mark Spoonauer directs LAPTOP’s online and print editorial content and has been covering mobile and wireless technology for over a decade. Each week Mark’s SpoonFed column provides his insights and analysis of the biggest mobile trends and news. You can also follow him on Twitter and .


AUTHOR BIO
Mark Spoonauer
Mark Spoonauer
Responsible for the editorial vision for Laptopmag.com, Mark Spoonauer has been Editor in Chief of LAPTOP since 2003 and has covered technology for nearly 15 years. Mark speaks at key tech industry events and makes regular media appearances on CNBC, Fox and CNN. Mark was previously reviews editor at Mobile Computing, and his work has appeared in Wired, Popular Science and Inc.
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  1. Gabriel Says:

    Wow just WOW…

    ALL what you said is WRONG…

    Go to OFFICIAL STORES of Verizon, AT&T, Sprint & Tmobile and grab their LATEST (brochure) PLANS & ready your dependable calculator then compare the rates plus taxes, fees & surcharges per month… then I will tell you – YOU ARE WRONG…

    Where in the world that you can have TOP OF THE LINE (HIGH-END) smartphone for free?
    When you buy a $600 worth of smartphone using your credit card, the financial institution will slap you finance charges and you NEED to oay monthly, quarterly or fully paid it in 1 year or 2 years.
    Tmobile will NOT slap you any finance charges, just what the phone price and after your fully paid the phone you can go back to what should be your monthly bill…

    Tmobile is the ONLY carrier that have the LTE-ADVANCE/HSPA+ 42MBPS in the USA, so they are correct that they will be much faster than any carrier as long you are COVERED.

    DON’T LIE TO YOUR READERS, BE TRUTHFUL AND HONEST…

    Thanks & have a great day…

  2. Junior Says:

    Since t mobile is unlimited you should choose a higher plan to compare. The $125 att plan with 6GB is $125 x 24 = $3000 plus $199 for the phone. T mobiles unlimited for $70 x 24 = $1680 plus $579 = $2259 for the phone because $99 + $20 x 24 that’s almost a $1000 savings.
    Pick the plan that you would typically use to compare it yourself. Also whoever has better coverage in your area is also important.

    You can pay off the phone early if you want with t-mobile. You can even leave t-mobile and still pay the regular payments of $20 until you pay off the phone

    And I can use the same argument. T-mobile HSPA+ 21/42 is super fast in my area and Verizon usually drops to 3G from LTE. We all know how bad Verizon’s 3G is. In the end weigh the cost savings and whoever works best in your area.

  3. Josh Says:

    I have to agree with the first person to comment on this story. Mark Spoonauer, you should be ashamed of yourself for writing such a dishonest article.

  4. Bearxor Says:

    Yep Mark, this blog post is pretty bad. I see that the unlimited data cap has been fixed so I won’t bother with that. In fact, I think the changes you made probably warrant the removal of the point altogether, but that’s a different argument. Lets just address point 1.

    You say lets compare with the 2.5GB plan from tmobile, but use the pricing of the unlimited plan.
    So it should be $60+$20×24+$99=$2019
    Compared to the 4GB plan you outlined on AT&T
    $70+$40×24+$199=$2839
    A savings of $820. Not $1000, sure, but I’m just correcting your math. Tmobile states their comparisons are done with their $50/500MB plan. That would give you the $1000 difference but I’m unsure what AT&T plan tmobile is comparing to and don’t feel like looking it up.

    Still, even if we use your original example, the best you can come up with for a phone plan that charges you full retail price for the phone, has unlimited minutes, unlimited texting and unlimited high speed data and is still cheaper than a provider that subsidizes your phone, provides unlimited minutes and texts and only 4GB pf data before charging $15/GB overage is that the savings are “significant, but not mind blowing.” Really? Shouldn’t you be asking why other providers are significantly more expensive?

  5. Xander Says:

    You use the Iphone 5 as an example in one “lie” and the Nexus 4 to show how much more it costs at T-mobile than from Google. No one sells the Nexus 4 as cheap as google. Matter of fact no one else sells the Nexus 4 at all. Why not use the Iphone 5 as an example here? Or GS3?

  6. vshah Says:

    Way to compare the 16gb tmobile nexus 4 against the 8gb google play nexus 4. really pitiful.

  7. Frederick Says:

    I was going to make a list of all the “facts” you got wrong, but it was too long, so I’ll just say that you should ashamed.

  8. TimG Says:

    Wow. I came here from the Fox News site, since I read it, I see that many others have already pointed out many failures in your blog.

    I was upset that someone who calls themselves a journalist would post such tripe .. and ‘lies’ themselves.. amazing.. Do you even FACT CHECK? God.. what trash this magazine supports now.. I used to respect opinions from here.

    Not now.

  9. Adam Says:

    I won’t rail on the blurred claims that you made on this article that seem more suspicious than the claims that T-mobile makes, but I will point out the one, tangible incorrect assertion.

    Google Store sells their Google Nexus for 299$ vs tmobile for 400+

    1) The Nexus for 299$ is 8Gb and the T-mobile version is 16GB

    Pay attention now, this is important:

    2) The nexus from Google Play also is NOT 4G. It has the hardware available, but Google and LG have not applied or received permission to activate or utilize hte 4G service for the phone sold from Google Play Store. T-mobile kicked out the money for their version.

    See how this whole…research thing works?

  10. Mark Spoonauer, LAPTOP Editor in Chief Says:

    The Nexus 4 is $457 on T-Mobile’s site. So $400 is a blurred claim on the price. The 16GB version of the Nexus 4 on Google Play store is $349. So you’re paying just $108 for LTE.

  11. Phil Says:

    WOW… this article is a bunch of lies….. terrible! Im sure ATT paid this idiot…

  12. Greevar Says:

    The difference in price between T-mobile and Google is that Google is selling it as a loss leader, while T-mobile is charging full price because they don’t get a discount from Google. T-mobile is not “overcharging”. But, if you don’t want to pay the price they’re charging, you could pay the $299 up front for the 8GB or the $349 for the 16GB, but you won’t get an interest free installment plan.

    Also, if you bring your own phone and merely compare the cost of plans, you do save as much as they claim. Phone aside, T-mobile is about $1000 cheaper.

  13. Mark Says:

    Go happy hunting with ATT then – see if you can find a plan with unlimited voice, unlimited text, unlimited MMS, and 500MB FAST data and slow data after 500MB, for 2 phones for $80.00/mo
    And you can use your own phones with that plan.
    This article is a total garbage.

  14. Sidney D Says:

    Editor in Chief huh. You gotta be kidding me.

  15. Sidney D Says:

    5 Ways the “Editor in Chief” Is Stretching the Truth

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