T-Mobile offering a truly unlimited data plan is a mostly good thing

T-Mobile created a lot of buzz this week when it announced it was bringing back an unlimited plan without data throttling. In the age of data caps and deprioritization, that seems like a pretty nice deal — and it might be. But as always, there’s more at play here than T-Mobile just offering a better unlimited plan.

T-Mobile says its new plan, Magenta Max, is truly unlimited. It includes 4K video streaming and high-speed data without deprioritization, where all other “unlimited” plans impose slowdowns once a user hits certain thresholds. T-Mobile chief marketing officer Matt Staneff confirmed in a call with The Verge yesterday that there are no strings attached to the deprioritization bit — it’s all-you-can-eat 5G data.

There is one string to be aware of, though. There is a 40GB cap on tethering, after which customers will get 3G data. But T-Mobile insists there’s no other funny business. For example, there are no limits on 4K video streaming, provided the streaming service you’re using offers it.

That’s notable because, according to the carriers, data deprioritization was imposed out of necessity to maintain network performance. Verizon reintroduced unlimited data plans in 2017, and shortly after, it imposed video quality limits and data deprioritization. In so many words, Verizon claimed this move was necessary because the network couldn’t handle the added congestion of unlimited subscribers. It wasn’t alone: throttling and reduced streaming video quality were standard practices across all major carriers at that point.

So how can T-Mobile afford to offer truly unlimited data now? According to the company, the difference is 5G. Specifically, the mid-band frequencies that T-Mobile uses for much of its 5G network allow for higher data capacities than 4G and are more robust than the narrow low-band frequencies Verizon and AT&T rely on for their nationwide 5G coverage.

But let’s remember why T-Mobile has all of that sweet, sweet mid-band spectrum: Sprint. The acquisition gave T-Mobile access to Sprint’s network, but it also effectively cut major wireless carrier options in the US from four to three. A federal judge allowed T-Mobile to go ahead with the deal, but under certain terms, that would help boost competition and (hopefully) consumer choice in other ways.

Photo by Chris Welch / The Verge

T-Mobile’s follow-through on those conditions has been a mixed bag. It did as promised by spinning off Sprint’s prepaid Boost Mobile business and selling it to Dish Network. Dish was allowed to lease T-Mobile’s network as an MVNO while it builds its own 5G offerings, another part of the deal. The good news is Dish looks to be serious about bringing its network online soon.

The bad news is Dish’s current wireless business looks a little shaky right now and could face further setbacks if T-Mobile moves ahead with its 3G CDMA shutdown early next year, which many of Dish’s customers currently use. While that doesn’t technically violate the terms of the agreement, Dish chairman and co-founder Charlie Ergen called it an “anti-competitive” move that would clearly benefit T-Mobile and harm Dish’s efforts.

So while T-Mobile’s unlimited plan is undoubtedly good for customers who sign up for it, the deal that made it possible might have weakened the US cellular industry as a whole. It’s possible, though, that we may see other benefits from T-Mobile offering this plan as it might put pressure on Verizon and AT&T to follow suit. It wouldn’t be the first time the self-named Uncarrier pushed the more established companies to expand their offerings. (See also: the return of unlimited plans several years ago.) We’ve asked AT&T and Verizon for comment and will update this article if we receive information from them.

Another reason T-Mobile may be offering this plan now is to take advantage of its comparatively strong 5G performance before AT&T and Verizon get their hands on more mid-band spectrum as a result of the recently concluded C-band auction. It won’t be until the end of this year or early 2022 that their customers will start seeing the benefits of the additional frequencies, so T-Mobile has extra incentive to attract new customers in the short term.

It’s also likely that the specifics of the plan will shift as the market and networks change. Wireless plans are notoriously complicated, and carriers will continue to change them when it makes good business sense to do so.

So what’s a phone plan shopper to do? The best bet might be to jump on a good deal like this while it’s around if it makes sense for you and / or your family. Existing subscribers are often grandfathered in when plans inevitably change and may get to hang on to some of the benefits. Carriers are going to look out for their bottom line, so it’s a good idea to do the same.