As part of the push to get approval for the proposed merger with Sprint, T-Mobile pledged that it will offer low-cost data plans, give free 5G to first responders and provide free broadband access to underserved households with school students. These offers are all dependent upon regulators and the states approving the merger.
The low-price broadband plans might be attractive to those who don’t use a lot of cellular data. The lowest-price plan offers 2 GB of data for $15 monthly. The price is guaranteed for 5 years and the data cap grows by 500 MB per year to reach 4 GB in the fifth year. The second plan offers 5 GB for $25 and also grows by 500 Mb per year to reach 7 GB by the fifth year. I assume adding voice and texting is extra.
The offer for free phones for first responders is just that. T-Mobile will offer free voice, texting, and data to first responders for 10 years. There will be no throttling of data and data will always get priority. The company estimates that this would save $7.7 billion nationwide for first responders over the ten years if they all switch to T-Mobile. Not surprisingly the other carriers are already unhappy with this offer, particularly AT&T which is busy building the nationwide FirstNet first responder network. This may be a somewhat hollow offer. The FirstNet network has some major advantages such as automatically interconnecting responders from different jurisdictions. But at least some local governments are going to be attracted to free cellular service.
The offer for school students is intriguing. For the next five years, the company is offering 100 GB per month of downloaded data to eligible student households. The company will also provide a free WiFi hotspot that converts the cellular data into WiFi for home use. T-Mobile estimates that roughly 10 million households would be eligible. Studies have shown that cost is the reason that many homes with students don’t have home broadband. In urban areas, the T-Mobile effort could largely eliminate the homework gap, at least for five years. That would give the country five years to find a more permanent solution. While T-Mobile would also help in rural America, many rural homes are not in range of a T-Mobile tower capable of delivering enough broadband to be meaningful. However, in many cases, this offer would be bringing broadband for homework to homes with no other broadband alternatives.
If the merger goes through, T-Mobile plans to mobilize the big inventory of 2.5 GHz spectrum owned by Sprint as well as activating 600 MHz spectrum. These are interesting spectrum, particularly the 600 MHz. This spectrum is great at penetrating buildings and can reach deep into most buildings. The spectrum also carries far, up to 10 miles from a transmitter. However, compared to higher frequencies, the 600 MHz spectrum won’t carry as much data. Further, data speeds decrease with distance from a cell sites and the data speeds past a few miles are likely to be pretty slow.
This plan makes me wonder how allowing millions of students onto the cellular network for homework will affect cell sites. Will some cell sites bog down when kids are all connected to the school networks to do homework?
I further wonder if the promise to offer free broadband to students also comes with a promise to supply enough backhaul bandwidth to poor neighborhoods to support the busy networks. Without good backhaul, the free bandwidth might be unusable at peak hours. I don’t mean to denigrate an offer that might mean a broadband solution for millions of kids – but I’ve also learned over the years that free doesn’t always mean good.
I’ve seen where a few states like New York are still against the merger, so there is no guarantee it’s going to happen. It sounds like the courts will have to decide. I suspect these offers will be withdrawn if the decision is made by courts rather than by the states.
Two Gigs of data helps no school-aged kid. There exists 30 or so days in the month. That evaporates, day 2. Face it. The merger is bad for everyone. Less competition means higher prices last time I checked. Alas, lobby monies will win the day.
The free school plan is 100GB of data. The $15/mo plan is 2GB of data. I don’t really understand the 2GB plan. There probably are some people that just need a low-cost plan but it’s definitely not for HD streaming/entertainment. It might be an interesting service for standby backup connections in the home.
Thank you for that clarification, Joe. 100 Gigs will get lots of homework done!