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T-Mobile Lobs Another Price Bomb

Bellevue, Wash. — In what it called the first of multiple new “uncarrier” initiatives launching over the next three days, T-Mobile unveiled a Simple Starter value plan that positions T-Mobile as the only major U.S. carrier offering a single-line 4G data plan at $40 with unlimited talk and unlimited texting.

The Simple Starter plan, which launches April 12, provides up to 500MB of 4G LTE data and tethering with no data-overage charges. After 500MB of data, data service is suspended unless users get on-demand data passes through, visiting a T-Mobile store, or calling customer care, a spokesman said.

The plan “is purpose-built for value-conscious wireless customers and small businesses that want predictability and affordability,” the company said. “With Simple Starter, you’ll get a ton more data compared to AT&T’s 300MB,” the carrier added.

AT&T offers a single line of service for smartphones with 300MB of data and unlimited talk and texting at $60 with two-year contract or $45/month with no contract and an unsubsidized phone, AT&T’s website shows. T-Mobile’s rates are also based on the purchase of unsubsidized phones without a contract.

AT&T users who want to use greater amount of 4G data than what’s available in AT&T’s entry-level plan must opt for additional data in $20 increments “in what amounts to an obscene 44 percent price hike on those customers least able to absorb overages and bill shock,” said John Legere, T-Mobile president/CEO, in a blog post.

“We are freeing consumers from the predatory practices of traditional U.S. wireless companies, and that includes these plans that start with a low price and a low data limit but then hit you with insane fees if you send one too many emails,” he wrote.

Simple Starter is targeted to users who don’t need international texting and roaming. Those who need international features opt for Simple Choice plan that include unlimited international data and texting from more than 120 countries, plus unlimited international texting from the U.S. to almost anywhere, the company said.

The new plan is the latest in a series of uncarrier initiatives that Leger said would again be proven successful when T-Mobile announces first-quarter 2014 financial results, due in late May. “It will be plain as day that we have got it right and they [other carriers] haven’t figured it out, or worse yet are selfishly unwilling to give consumers what they really want and need.”

“Just look at the frenzy of knee-jerk moves the competition launched in recent weeks,” he continued. “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.” Those carriers “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 uncarrier innovations like our JUMP upgrade program.”