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MetroPCS cuts unlimited plan to $40 a month

MetroPCS has lowered its price on its unlimited plans in what looks like the beginning of a price war in the prepaid wireless market.

MetroPCS, which has recently expanded its prepaid wireless service offering to several large cities throughout the U.S., has just lowered its unlimited monthly plan to $40 a month for voice, texting and Web access.

The new lowered prices ushers in a new era of competition in the prepaid market, which is heating up as Sprint Nextel started offering a $50 a month unlimited plan in January. Executives are attributing the recent growth in its prepaid customer base to this new service.

MetroPCS's cuts could spark a price war, which could further drive down how much revenue is generated per user. In a market that already relies on heavy customer volumes and super low cost structure to reach profits, further pricing pressure will only make it more difficult for these carriers to make money with prepaid services. But the good news for consumers is that they will get access to some very good deals in wireless if the choose to take the prepaid wireless route.