The Un-Carrier unwraps new rate plans and upgrade scheme
T-Mobile last week announced the upcoming availability of its new rate plan and upgrade program as part of its latest Un-Carrier push. The carrier announced three new rate plans, the Go5G, Go5G Plus and the affordable Essential Savings plan, which all be available alongside its ongoing Magenta plan options. The plan capturing the Un-Carrier spotlight is the Go5G Plus which, like the Magenta Max plan, comes with unlimited premium data, free content bundles (Netflix and Apple TV+), but upgrades the 40 GB/month hotspot bucket with a 50 GB/month at an additional $10/month (for three lines). T-Mobile also pledges that users on the new plan are guaranteed to be eligible for the same new device offers as new T-Mobile customers when it is time to upgrade their devices. The mid-tier Go5G plan, also offers 50 GB/month of premium data (versus the mid-tier Magenta plan’s 100 GB/month premium data offer), but triples in mobile hotspot allotment (15 GB vs 5 GB/month). T-Mobile’s new program also allows AT&T customers to bring their locked devices for trade-in, and new customers who are not satisfied with their service are given the opportunity to cancel within 30 days and receive a $50 per line credit.
The Circana Take:
- T-Mobile’s latest Un-Carrier move features intriguing novelties such as giving AT&T customers the ability to trade-in their locked smartphones, but apart from that, there is very little new in the mix for new and (especially) existing customers. The pledge to guarantee the extension of the switcher device promotions to existing customers is welcome, but T-Mobile already has an upgrade program dubbed the “Forever Upgrade” that does exactly what is touted as part of this new marketing campaign.
- T-Mobile is right in their messaging that it is still a hassle for AT&T customers who paid off their phones get those phones unlocked (they need to go through a special webpage and enter intricate details about the phone such as the IMEI number). So, accepting locked phones for trade-in addresses a pain point, but it should be noted that locked or unlocked these phones need to be paid off before they disconnect from the AT&T network.
- According to the Circana Connected Intelligence Mobility survey, almost a quarter of AT&T customers who were on a device financing program with the carrier have their phones paid off. These are the customers who have yet to join the 36-month program that was launched in June 2021, and T-Mobile’s affordable rate plans can attract them. On the other hand, we should remember that most of these users are iPhone customers and will likely wait for the upcoming iPhone 15 debut before committing to a new financing deal with T-Mobile or any other carrier.
- Almost the entire postpaid market has shifted to 36-month financing, which is a major challenge for device makers as consumers typically do not seek a new phone until they are done with their payments. T-Mobile’s commitment and heavy emphasis around 24-month financing and upgrade promotion pledge should be music to the ears of all device makers; however, it should be noted that 36-month financing options are favorable by consumers as they lower the entry cost barrier (paying $27/month for a $999 phone versus $41/month on a 24-month program) at a time when each dollar counts due to challenging inflationary environment hurting their financial livelihoods.
- According to sources, the heritage Magenta plans will only be available through the carrier’s online channels. We see this as an important marketing shift as T-Mobile slowly distancing its plan marketing for the “Magenta” theme to the “5G” theme, which resonates better with the carrier’s overarching goal of establishing itself as a reliable 5G network provider in the minds of consumers. T-Mobile’s lead network rival Verizon has long been marketing its rate plans under the 5G theme (e.g. 5G Play More, 5G Get More and etc.)