T-Mobile launches new ‘Simply Prepaid’ plans, starting at $40/month with 1 GB of LTE
Phil Goldstein / FierceWireless :
Context & Ripple Effects
T-Mobile is extending its growth run into the value end of the market: a week earlier it reported 2.1 million total new customers in Q4, and Simply Prepaid is how it converts that postpaid momentum into the prepaid aisle. The move lands days before Sprint's Virgin Mobile counters with new prepaid shared data plans at Walmart, complete with a $5/month unlimited-data option in select apps — the two launches bracketing each other within a single week shows prepaid was the active front in early 2015.
First-order effects
- Sprint's Virgin Mobile now faces a direct $40/month competitor from the carrier with the strongest subscriber momentum of the quarter, right as it pushes its own shared-data prepaid plans through Walmart retail.
Second-order effects
- The 1 GB LTE allowance sets a concrete benchmark for prepaid pricing, pressuring rivals to match or exceed the data-per-dollar figure at mass-market retailers where prepaid handsets are actually sold.
Third-order effects
- Prepaid functions here as the entry rung of a ladder T-Mobile keeps extending upward — from capped 1 GB plans to the $70 "unlimited" high-speed plan launched in 2016, and eventually to cap-free broadband with its 5G home internet service at $60-$65/month — suggesting capped prepaid tiers are transitional products on the way to flat-rate connectivity.
The trend: US carriers are using low-cost prepaid tiers as acquisition wedges, with data caps steadily giving way to unlimited and then fixed-broadband offers.