T-Mobile’s New Plans Say How Much Goes to Paying Off Your Phone

Yahoo Contributor Network

"Free with a two-year contract!" That's roughly the going price of a smartphone these days. But those two-year contracts are widely seen as overpriced, and everyone knows that that's how you really pay for the smartphone.

Wireless carrier T-Mobile, however, is trying a new approach to smartphone pricing, which is in some ways more honest about what your smartphone will actually cost.

The real price of your gadgets

T-Mobile's new lineup of wireless plans are now contract-free, meaning you aren't locked in for two years. You pay for the smartphone separately, and you can choose to pay its full price up-front -- the same way you would with most prepaid carriers -- or pay for it over two years. Each phone costs a different amount per month, based on what it actually costs to buy.

Are T-Mobile's prices competitive, though?

The prices listed on T-Mobile's website are often more expensive than what it would cost to buy the phone up-front from a prepaid wireless carrier. T-Mobile charges $384 for the Samsung Galaxy S II, for instance, while Virgin Mobile charges $329 for it (less $50 for a promotion which expires today). Its $457 Nexus 4 smartphone is $349 directly from Google (and unlocked), and its $589 Samsung Galaxy S III is $499 on MetroPCS.

As the unlocked Nexus 4 example suggests, though, T-Mobile does allow you to bring your own phone, if it's "compatible and unlocked."

Taken together with the plans

The plans themselves start at $50 a month for a single smartphone. They're technically unlimited everything -- talk, text, and data -- but your web browsing speeds are throttled to 2G after 500 MB. (T-Mobile's website makes it very clear how much high-speed data you get.) An additional $10 a month gets you an extra 2 GB per month. Android Police's Eric Ravenscraft analyzes T-Mobile's new plans,and compares its costs to its competitors'.

What about tethering?

Tethering, which T-Mobile calls "Smartphone Mobile HotSpot service," is included with each plan. You can use any of the data with your laptop or tablet, using your phone as a hotspot. If that's not as important to you, you can go up to completely unlimited data for $70 a month, but with only 500 MB worth of tethering.

What about T-Mobile's old $30 unlimited data plan?

For those who browse the web and watch lots of videos, but don't make many phone calls, T-Mobile still has its $30 prepaid unlimited data plan available. Despite the similarities between T-Mobile's current plans and what are thought of as prepaid plans, these are still in a separate part of its website.

The catch? You only get 100 voice minutes per month, and your data speeds are throttled after the first 5 GB. The plan's also buried on T-Mobile's website. It's not nearly as prominent as it used to be before the new plans were unveiled, which suggests that T-Mobile is trying to steer people away from it.

Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.

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