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T-Mobile to cut wireless-data prices

The German wireless provider is cutting wireless-data subscription prices in half to lure more people onto its new high-speed cell phone networks.

T-Mobile is cutting wireless-data subscription prices in half to lure more people onto its new high-speed cell phone networks, an executive with the German wireless provider said on Wednesday.

Nikesh Arora, T-Mobile chief marketing officer, said the new subscriptions rates will hit next month in Europe and eventually be introduced in most of T-Mobile's markets.

Under the new T-Mobile pricing plans, a megabyte of data costs $10, which is about half as much as European carriers now charge. On a cell phone, a megabyte of data is good for sending about 300 messages or downloading about 1,000 wireless Web pages. On a PC, that amounts to downloading about five graphically rich Web pages.

Other price cuts and additional details about the new plans will be announced by T-Mobile in the next week or so, Arora said.

T-Mobile is the latest, among carriers that have sunk billions into building new cell phone networks, to cut the prices for services like e-mails or viewing Web pages on phones. Sprint PCS is now offering its PCS Vision phone owners unlimited wireless Web access for $10 a month. Verizon Wireless is selling unlimited text messaging, a change from its per-message fee model.

T-Mobile and other carriers hoped selling wireless data, which also includes downloadable games and picture messages, would earn them new revenue and help offset the cost of building new networks. Aside from doubling the capacity for voice calls, the new networks ferry data up to four times faster than the ones being replaced.

But one thing--high prices--has kept many new customers away, said analyst Alan Reiter of Wireless Internet & Mobile Computing. He said the impact is most dramatic in the United States, where only 10 million of the nation's 140 million dialers use any kind of wireless-data service.

"Carriers have been pricing data based on spreadsheets, not on what consumers are willing to pay," Reiter said.