Confusion reigns again in wireless.
Sprint, the No. 4 carrier, offered a hair-raising $15 a month unlimited wireless plan, only to schedule it to end just a week after it began.
Verizon Wireless, as the market leader, took a decidedly different path with the introduction of a higher-priced unlimited plan on Thursday that targets data-heavy users.
AT&T is also going higher with an announcement last week that customers on its “grandfathered” unlimited data plan would see a $5 price hike in July.
T-Mobile was quick to pounce. Starting June 20, it will pay AT&T customers who switch to T-Mobile off one of those grandfathered plans $250.
With wireless prices moving every which way, you may be wondering if you've got the best deal, not to mention what your package of wireless and internet subscriptions might include.
Consolidation in the media, technology and entertainment space may only puzzle you further. AT&T got the go-ahead from a federal judge this week to complete its $85 billion acquisition of Time Warner.
Comcast, which has also dipped its toes in wireless with its Xfinity Mobile service that piggybacks off Verizon’s network, is battling Walt Disney Co. for some of the prized TV and entertainment assets in Rupert Murdoch’s empire at 21st Century Fox.
And while continuing to operate independently, T-Mobile and Sprint are sweating out regulatory approval for their own pending $26 billion merger.
Even before all the M&A action, the leading telecom carriers had been bundling in such video services as HBO, Hulu and Netflix, as incentives to attract or keep wireless customers – and in some cases to prop up prices for the unlimited plans that represent the new normal.
Once blazing fast, next-generation 5G wireless networks start to become a reality in 2019 and beyond, such content offerings could get more compelling while also helping the carriers justify higher prices. At that time, you could see deals targeted at gamers. Or offerings aimed at people seduced, say, by the promise of virtual reality.
Before then, what could happen to your cell-phone bill? In the past, consumers have benefited from aggressive moves by T-Mobile and Sprint to lure subscribers from market heavyweights AT&T and Verizon. T-Mobile's move to end unpopular two-year contracts, for instance, eventually was embraced by all the carriers.
But with costs moving in both directions, “I don’t think this is the start of a price war,” Lynnette Luna, principal analyst for global telecom consumer services platforms and devices at GlobalData.
If anything, in fact, prices could inch higher. T-Mobile and Sprint “love to talk about how aggressive they will be on the pricing front. I don’t believe that will be the case when you only have three competitors in the market,” Luna says.
As it has struggled financially, Sprint pulled out all the stops to gain new customers. It previously gave away a year of service free on its Unlimited Freedom if switchers brought their own phone.
Sprint’s $15 plan was always meant to be a short-term offering. It was “to create this really shocking rather aggressive offering … to inspire people to come over and try us … almost like a flash sale online," says Dow Draper, Sprint’s chief commercial officer. “We know the best way to get customers is to be referred by existing customers.”
The carrier's regular $60 unlimited plan for a single line has fewer restrictions than the $15 online-only offering and includes HD video, Hulu and other features.
But Sprint's merger partner T-Mobile, the fastest-growing carrier, doesn't have as much incentive to drop prices, says analyst Roger Entner of Recon Analytics.
On the other hand, Entner envisions AT&T taking a more aggressive stance, “since it is now fighting for share and profit and not just managing its profit margins.”
Whichever way AT&T moves on wireless pricing, it does seem more likely to bundle more content from its new corporate partner Time Warner. AT&T already announced plans to roll out a $15 “skinny bundle” streaming service branded WatchTV later this year, which will be free for customers on some unlimited data plans. It won't include sports-only channels or local programming.
“We think customers are going to be very excited about the new unlimited plans with even more entertainment that we’ll announce very soon,” AT&T said in an emailed statement.
Wireless customers are already getting pitched variations on unlimited plans. Verizon’s new top-tier monthly plan, called "Above Unlimited," starts June 18 and costs $20 more per line than the company’s cheapest unlimited offering and could reach as much as $240 for four lines.
What you get for such a lofty sum may be overkill for many users. It comes with up to 75 GB of high-speed data before you might be throttled or slowed when the network is congested – a situation many might only encounter here and there. Also included: 500 GB of Verizon’s Cloud storage for backing up your phone and 20 GB for turning your phone into a Wi-Fi hot spot.
Consumers on a tight budget can always turn to another segment of the market, the so-called MVNO (Mobile virtual network operators) discounters who lease lines from major carriers, many of whom offer cheaper prepaid wireless rates.
Critics of the T-Mobile-Sprint merger, such as the founder and former CEO of Boost Mobile USA Peter Adderton, recently told USA TODAY that if the deal is approved, these challenger brands, and their lowest rates, would be at risk.
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