Tuesday, January 08, 2013

T-Mobile has a 1.9 million head start on iPhones on its network

T-Mobile will get the iPhone this year. We don't know when, but we know it will happen this year. But it already has a head start, a 1.9 million device head start on the official iPhone release.

Speaking on CNET on Tuesday, T-Mobile's Chief Technology Officer Neville Ray said that there are already 1.9 million iPhones on T-Mobile, with the carrier having a monthly run rate of 100,000 new iPhones entering its network.

That's pretty good for a carrier that hasn't really -- until recently -- even supported the iPhone's 3G capabilities. T-Mobile has begun making improvements in its network, allowing the iPhone -- whether iPhones purchased or jailbroken and unlocked iPhones -- to finally run on something aside from super-slow EDGE, but only had 15 markets upgraded as of last November.

In those markets, the iPhone can run on HSPA+, which T-Mobile calls 4G, but which tech gurus prefer to call faux 4G, as opposed to LTE. It is, however, significantly faster than EDGE.

In September, T-Mobile began a campaign designed to get AT&T customers to switch, and even went so far as to put iPhones in its stores for demonstration purposes. T-Mobile has been using both pricing and dissatisfaction with AT&T's service for its campaign.

It's unclear how consumers will react when T-Mobile actually begins selling the iPhone, though. The nation's No. 4 wireless carrier will sell the iPhone only unsubsidized, meaning the popular subsidies that lower the cost of a cell phone but lock a customer into a long-term contract won't exist.

This won't be isolated to the iPhone, but across its line. T-Mobile already supports this type of system, but in 2013 it will be the only way customers can buy devices and use them on the carrier's network.

T-Mobile currently offers both Classic and Value plans. Classic plans subsidize the device and require a two-year contract, as with other carriers. Value plans let customers pay the full cost of their smartphones or pay it monthly in exchange for lower monthly service rates. Customers can also bring their own devices to the network.

Carriers typically subsidize the cost of devices to lock a customer into a contract. That means that the fully-priced 16GB iPhone 5 ($649) can be sold at $199. This applies to other phones, such as Android, as well.

The 2013 Value plans will be "fair and simple pricing" with "low out of pocket expenses" for customers. T-Mobile has already said that customers may be able to purchase the "most iconic device in the world" for $99 and then pay monthly installments of $15 or $20 over the next 20 months, but that isn't written in stone.

Those installments will be on top of the Value plan pricing. It's unclear at this time what the new Value plan pricing will be.

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