T-Mobile's new pricing explained

Something I've noticed is that for many people, T-Mobile's pricing seems worse. These users talk about how you have to pay more for the phone, but they don't understand how T-Mobile separated the phone cost from the plan cost. So, if you fall into that boat, here's a guide for you.

Here's a comparison using a Samsung Galaxy S III on an individual plan with unlimited talk, text, and data. Simple Choice is the new plan (offered at T-Mobile corporate stores and on their websites), while Classic Plans are the old subsidy plans, similar to other carriers, and only offered at retailers like Wal-Mart, Best Buy, and T-Mobile authorized resellers.

Simple Choice: (note, this plans includes 500MB of mobile hotspot service)
Device - $69.99 up front, $20/mo for 24 months
Plan - $70/mo
1 year cost - $1,149.99
2 year cost - $2,229.99
3 year cost - $3,069.99
Termination Fee - equal to the amount that you still owe on your phone

Classic Plan: (no mobile hotspot included)
Device - $149.99 up front
Plan - $90/mo thereafter
1 year cost - $1,229.99
2 year cost - $2,309.99
3 year cost - $3,389.99
Termination Fee - $200 at first, depreciates from there

These plans only really seem to pay off from a cost standpoint if you keep your phone for way more than 2 years. Perhaps I'm wrong tho.

It's basically the same pricing as before except your bill goes down after 24 months... I think most people upgrade before 2yrs anyway.

Contract vs monthly installments - It's all the same.

DirtyB said:

These plans only really seem to pay off from a cost standpoint if you keep your phone for way more than 2 years. Perhaps I'm wrong tho.

It's basically the same pricing as before except your bill goes down after 24 months... I think most people upgrade before 2yrs anyway.

Contract vs monthly installments - It's all the same.

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You are only thinking from high end phones, you aren't considering getting an older phone, used phone, same phone you had before. Three only reason why most upgraded every two years is because their plan had that in it. If more people move to this for the price I doubt hardly anyone will give a crap about being on an old phone.

DirtyB said:

These plans only really seem to pay off from a cost standpoint if you keep your phone for way more than 2 years. Perhaps I'm wrong tho.

It's basically the same pricing as before except your bill goes down after 24 months... I think most people upgrade before 2yrs anyway.

Contract vs monthly installments - It's all the same.

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They are cheaper up front for a high-end phone. These phones are often $50-$100 cheaper up front with the same monthly price for 24 months.

As Trimlock mentioned, cheaper phones give even more of a benefit. Not only do some phones still come in at about $50 cheaper up front, but then have a monthly cost of less than $20, causing you to save even more every month.

Anyway, I didn't expect any replies to this thread. I was expecting it to fall past the first page quickly, but would be something that I could link to whenever this comes up. There are still many people who are misinterpreting these plans as being the same cost as before, but now having to pay full price for the phone. The only scenario where I see these plans costing more is if you cancel your contract immediately after getting the phone. This is due to T-Mobile still having a low ETF for subsidized plans.

The T-Mobile plan is still cheaper even if with the high end phone.

the real payoff comes if one buys a second hand phone off ebay or even hardforum or craigslist. wait a year, get the next best iphone, or next best android phone, and you'll be saving lots. especially now, where we are at the point where even 2 year old phones (Galaxy S2 era, and almost iphone 4S) are good enough to use and not feel too limiting.

I typically keep my phones until they quit. I would still be using my HD2 if it had not given up the ghost after 2.6 years of service. This time I got the Nokia 810 and we'll see how long this phone will last. It's 2 months old now lol. I don't care much for modding a phone, I just need it to provide internet sharing and the ability to make a phone call. Value plans are great for people that actually keep their hardware for long periods of time

Does anyone know if it's still possible to purchase a phone off-contract with a down payment and monthly payments?

lawlz_xd said:

Does anyone know if it's still possible to purchase a phone off-contract with a down payment and monthly payments?

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They advertise it as being off-contract, IE, the phone service is no on contract. However, you've essentially got an interest-free loan on the phone. You are obligated to pay it off one way or the other. So when you terminate your phone plan, you owe them the remaining balance on the phone. Regardless of the semantics, to the casual user, this is no different than a contract with a termination fee.

You can always purchase a GSM "burner" phone and use your SIM card in it instead. I personally am usually 1 generation or so behind & always have friends willing to sell me their old phones. The Google Play store is also a great place for an inexpensive, non-contract smartphone.

Medion said:

They advertise it as being off-contract, IE, the phone service is no on contract. However, you've essentially got an interest-free loan on the phone. You are obligated to pay it off one way or the other. So when you terminate your phone plan, you owe them the remaining balance on the phone. Regardless of the semantics, to the uninformed person that does not take the time to fully understand what they are doing, this is no different than a contract with a termination fee.

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Fixed for accuracy

lawlz_xd said:

Does anyone know if it's still possible to purchase a phone off-contract with a down payment and monthly payments?

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Yes as long as you are maintining service with them. If you have no service with T-Mobile, you have to pay full price up front including taxes. If you have service with them and you decide to leave, you must pay off the remaining balance.

BTW that down payment that they show you does not include taxes so in reality you are paying about $150 up front by the time you include shipping fee (if any) and tax on the phone price.

YeuEmMaiMai said:

Yes as long as you are maintining service with them. If you have no service with T-Mobile, you have to pay full price up front including taxes. If you have service with them and you decide to leave, you must pay off the remaining balance.

BTW that down payment that they show you does not include taxes so in reality you are paying about $150 up front by the time you include shipping fee (if any) and tax on the phone price.

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And you have to pay activation fee, plus you only get a tmobile branded phone (this is typically not a really bad thing).