CFO: $10 increase for unlimited required to make a return on network improvements


At the end of last week, T-Mobile surprised us all by rolling out an update set of Simple Choice plans. Replacing its three-tier system with four. Bumping up the data allowance on the two cheapest plans and adding Stateside international calling and texting would possibly have stolen the headlines had the changes not also bumped unlimited data at high speeds up by $10 per month.

The reason for this price increase has been unveiled by T-Mobile’s CFO, Braxton Carter, according to a report by Fierce Wireless. Speaking at the the Internet & Telecom Conference, Carter stated that this $10 increase was needed to help the company make some money back on its fast and expensive network expansion efforts.

It’s clear – that over the past 12 months or so – T-Mobile’s focus has clearly been on taking on more consumers and expanding its network reach. But that doesn’t happen without an expense, and although it’s still clearly focussed on growth, it needs to keep an eye on the bank balance too.

“…being focused just on consumer growth without resulting increases in cash flows and profitability would not be the right approach, that you have to have a holistic view. We’ve also talked about the significance of data monetization, or being paid for what we’re providing in the marketplace.”

Now, there’s a reason why the $70 price plan has been altered to only include 5GB of data, and it may not be as stingy as it sounds. On average, T-Mobile’s unlimited customers tend to use around 5GB data. And, the $70 plan also lets you use the 5GB for tethering – up from 2.5GB.

With the inclusion of more data and international calling/texting, most of the Simple Choice fans are much better value for money. And if T-Mobile needs the extra income from the $80 plan to keep up its expansion across the States, I’d say that’s a wise move from a consumer and business standpoint.

Via: FierceWireless

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