Reports of the unlimited data plan's demise may be greatly exaggerated.
T-Mobile on Wednesday became the first U.S. carrier to backtrack on eliminating its unlimited plan, promising a "worry-free" 4G agreement with no data caps or "bill shock" from overages. Its 4G network is HSPA+, but it plans to introduce a faster long-term evolution network next year.
Its top rivals, however, already run growing LTE networks, the gold standard of 4G speed.
The struggling carrier owned by Bonn, Germany-based Deutsche Telekom AG, will offer the new plan beginning Sept. 5 to existing customers or those who purchase a new 4G smartphone or have a compatible device. The cost is $20 per month when added to a $49.99 Value voice and text plan or $30 when added to a $59.99 Classic voice and text plan. (Prices are for individual lines.)
"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 of marketing for T-Mobile USA. "Consumers want the freedom of unlimited 4G data."
The only other major carrier to offer unlimited data to new customers is Sprint Nextel, which offers a $109.99 Simply Everything plan with no throttling. (T-Mobile previously slowed down heavy data users after two, five or 10 gigabytes.) Sprint, however, collects a $10 premium smartphone charge per month.
Smaller carrier MetroPCS Communications has long offered flat rates for talk, text and data but this week lowered the price from $70 to $55, including 4G data. The carrier also unveiled a new smartphone, the LG Motion, which runs Google's Android 4.0 Ice Cream Sandwich operating system, for just $149. The $55 plan is being sold as a temporary promotion but no expiration date was cited.
MetroPCS, based in Richardson, Texas, operates an LTE 4G data network that began rolling out in September 2010.
Alternative to LTE
"We are seeing the commoditization of LTE now being implemented," said analyst Gerry Purdy of MobileTrax. "MetroPCS was the first carrier to launch LTE, and although they are not in every city they are in major metropolitan areas."
Purdy said both T-Mobile and MetroPCS are "looking for ways to be competitive against AT&T and Verizon Wireless, and the unlimited plan at T-Mobile shows that since they haven't rolled out any LTE they have to do something to be able to compete, so why not give all-you-can eat data."
Neither carrier is currently licensed to sell Apple's iPhone, the newest version of which is expected to roll out next month. Since the upgrade is widely expected to be LTE compatible, that makes it unlikely T-Mobile will join the iPhone parade this year.
It's more likely that we'll see a MetroPCS version of the iPhone if it goes to LTE," Purdy said.