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T-Mobile USA: Our new unlimited data plan is actually unlimited

Carrier compensates for iPhone-less inadequacy

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Wireless carrier T-Mobile has what it describes as a "bold" new feature in store for its upcoming unlimited data plan: This time, it's actually going to be unlimited.

Like most other major American mobile carriers, T-Mobile's current "unlimited" plans have their limits. The amount of data that punters can download is not capped, but only a certain amount of it will travel over the carrier's high-speed network. After the limit is reached – either 2GB or 5GB, depending on the cost of the plan – the phone's data connection is throttled down to a lower-bandwidth tier.

On Wednesday, T-Mobile announced that its latest data plan does away with such limits. The Unlimited Nationwide 4G Data plan, available beginning September 5, has "no data caps, speed limits or bill shock," the carrier says.

"Consumers want the freedom of unlimited 4G data," T-Mobile's VP of marketing, Kevin McLaughlin, said in a statement. "Our bold move to be the only wireless carrier to offer an Unlimited Nationwide 4G Data plan reinforces our value leadership and capitalizes on the strength of our nationwide 4G network."

The two top US carriers, AT&T and Verizon, both throttle heavy users of their unlimited data plans, much as T-Mobile does now. The third-place carrier, Sprint, doesn't throttle data customers, though it reserves the right to boot them off its network if they start wolfing down too much bandwidth.

All four carriers say such measures are only an issue for the greediest of data gobblers and that ordinary users will never hit their data ceilings, but some customers and consumer groups argue that "unlimited" should mean unlimited. In March, AT&T adjusted its throttling rules in response to widespread criticism of its policies.

Meanwhile, fourth-place carrier T-Mobile has struggled to retain customers in recent months. The only major US carrier not to offer the iPhone, it has increasingly turned to novel service plans as a way to attract a hardcore base of smartphone users, primarily with Android handsets.

For example, last year the carrier began offering discounted voice, text, and data plans for customers who provide their own devices, as opposed to traditional plans that have higher monthly rates but offer subsidized handset pricing.

So far such measures have done little to stem the erosion of T-Mobile's customer base. In May, the carrier actually boasted that it only lost 510,000 contract customers in the first quarter of 2012, saying that the figure represented its lowest losses in seven quarters.

In 2011, T-Mobile USA's parent company, the German giant Deutsche Telekom, tried to unload the flailing carrier to competitor AT&T for $39bn, but that proposed merger was eventually crushed under the weight of heavy scrutiny from the Federal Communications Commission (FCC).

The collapse of that deal left T-Mobile with a little extra cash in its pocket and some newly acquired wireless spectrum, but without a clear means of pulling itself out of its doldrums. For now, it seems to be betting that it can win back customers by targeting its message squarely at the increasingly data-hungry smartphone market.

But even that is not a sure bet. T-Mobile's data network is aging. What it currently calls its 4G network is based on the older HSPA+ wireless data technology, as opposed to the faster LTE technology already being deployed by its rivals. T-Mobile has invested $4bn to bring LTE to its own network, but it doesn't expect to market the service until 2013.

In the meantime, its customers will at least be allowed to slurp down unlimited wireless data, even if it isn't at the fastest speeds. The new plan will cost $20 per month when added to a bring-your-own-device plan or $30 per month when added to a plan with subsidized handset pricing. ®

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