from the almost-what-competition-looks-like dept
While the U.S. wireless industry isn't quite as competitive as it's portrayed as (non-price competition is generally the law of the land), T-Mobile has still managed to disrupt the sector with a crazy idea: giving users what they want. That was again made evident this week when Verizon was forced to bring back sort-of unlimited data after spending the last several years telling consumers they didn't really want such simple, straightforward plans. Verizon's long-standing belief that it can tell consumers what they're supposed to want took a notable blow this week by any measure.
Shortly after Verizon announced it was returning to unlimited data, T-Mobile once again upped the ante, announcing it would no longer be charging an extra fee to stream HD video over the company's LTE Network. According to the announcement, T-Mobile not only stopped charging a premium for HD quality (the de-prioritization of which you may recall T-Mobile lied was happening at several points), but also eased up on the restrictions surrounding tethering (using your phone as a modem).
In a statement, T-Mobile CEO John Legere hinted at studies showing that Verizon has nearly lost its network size and speed edge over T-Mobile, which the company had long been using to justify its refusal to more seriously compete:
"I don’t blame Verizon for caving. They just lost their network advantage, and they know it … and more importantly, more and more customers know it. Their back’s against the wall,” said John Legere, president and CEO at T-Mobile. “This is what the Un-carrier does—drag the carriers kicking and screaming into the future. Next up, we’re going to force them to include monthly taxes and fees. Mark my words."
Granted the term "unlimited" is still being abused here, since you may find your connection throttled (technically "de-prioritized") after 28 gigabytes of consumption on T-Mobile's network, or 22 gigabytes of consumption on Verizon Wireless. And U.S. residents will still probably wind up paying significantly more money at slower speeds than most developed nations. Meanwhile, T-Mobile tells Ars Technica that video on the T-Mobile network is still throttled to 1.5 Mbps by default, with the onus placed on customers to remember to enable HD video manually or it reverts to the default, de-prioritized state:
"T-Mobile responded to our question about HD video day passes by saying, "All customers have to do to get HD is go into the app or online to turn on. It’s very easy." Customers still have to enable HD video every 24 hours or it reverts to 480p, a T-Mobile spokesperson told Ars via e-mail. However, the company's Twitter support account says it only will have to be enabled once per month. T-Mobile's press release doesn't clear things up."
Even with caveats, this is at least providing a vague resemblance of what wireless competition is supposed to look like. Given the number of customers T-Mobile is now hoovering up from AT&T, it may also force AT&T to revisit its own opposition to unlimited data plans (currently only available if you subscribe to both AT&T wireless and DirecTV). So even though the industry still struggles with the dictionary definition of unlimited, the fact T-Mobile is pushing AT&T and Verizon to actually try to compete is certainly a good thing.
The problem is that competition in the wireless space is viciously fickle, and by and large most of AT&T and Verizon's promotions remain somewhat theatrical in nature when it comes to actually lowering your overall price once various fees are factored in. And should the rumored T-Mobile and Sprint merger be approved by regulators, you can be fairly sure that even this level of more superficial competition may not be around for long.