T-Mobile tries out $50 unlimited wireless plan

Wireless operator is offering a new promotion to help retain customers and hopefully pick up some new ones, as it competes more on price.

T-Mobile USA, the fourth-largest cell phone operator in the U.S., is launching new service promotions in an effort to keep long-term customers and attract new ones.

The company plans to offer a special $50 per month unlimited voice plan to longtime customers in San Francisco, initially. It will also offer new customers who switch from a competitor a $135 rebate, Reuters reported Thursday.

T-Mobile's new plan will only be available to San Francisco customers who have used its service for 22 months or more, according to a T-Mobile representative who spoke to Reuters. An analyst told the wire service that the plan will likely go nationwide soon.

The promotions come as T-Mobile faces stiff competition from the three other major cell phone operators in the U.S. During the fourth quarter, AT&T and Verizon each added customers. AT&T added 2.1 million customers , including 1.9 million iPhone users. Verizon Wireless added 1.4 million new subscribers in the fourth quarter.

T-Mobile USA also added customers in the fourth quarter , but its figure was considerably lower at 621,000. It was also down from the previous quarter's figure of 670,000 new subscribers, and down considerably from a year earlier when it added 951,000 subscribers in the fourth quarter of 2007.

The bulk of T-Mobile's new subscribers came from prepaid accounts, as the total number of customers signing up for contracts slowed compared with previous quarters.

Meanwhile, Sprint Nextel, which reported fourth-quarter earnings Thursday, continued to lose customers, shedding 1.3 million customers during the fourth quarter.

The results from the four major carriers suggest that higher-value customers, who enter contracts and generally generate more revenue per month, are gravitating toward the two biggest carriers, rather than T-Mobile or Sprint.

T-Mobile and Sprint seem to be duking it out for value customers, which is where these new promotions from T-Mobile are targeted. In fact, it looks as if T-Mobile's marketing may be in response to a new plan that Sprint's prepaid brand, Boost Mobile, launched in January. Boost is offering an unlimited mobile plan for $50 a month. During Sprint's earnings conference call on Thursday, executives for Sprint said the service is off to a good start.

 

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