MetroPCS Raises the Cost of Unlimited

MetroPCS Inc. (NYSE: PCS) customers who want unlimited data and video on-demand content over Long Term Evolution (LTE) will now have to pay US$10 extra.

The contract-free carrier has increased the price of its unlimited data plan from $60 to $70 a month, as well as removed access to MetroStudio videos from the $60 plan, which is now throttled after a data cap of 5GB is reached.

MetroPCS's data plans now include:
  • $40 for 250MB of LTE data per month, a plan Ed Chao, SVP of engineering for MetroPCS, says is designed for legacy Brew handsets
  • $50 for 2.5GB of data per month, 1.5GB more data than the $50 plan previously offered
  • $60 for 5GB per month plus Rhapsody Networks 's streaming music service
  • $70 for unlimited data, MetroStudio VoD and Rhapsody

According to a MetroPCS spokesman, MetroStudio VoD is also offered as a $10 add-on feature for customers on lower-priced plans, with content counting toward their plan's respective caps. Once the cap is reach, data speeds are throttled to a speed similar to what they might experience on the carrier's 3G networks, he says.

Why this matters
Just last week, MetroPCS VP of Finance and Treasure Keith Terreri told a Barclays Capital conference audience that the carrier was considering adding another higher tier of data for its LTE service plans, so the move isn't a big surprise. (See MetroPCS Balks at Wholesale LTE.)

It is interesting, however, that video is only available on the highest-price unlimited plan or as an add-on charge. It's clearly the app that's driving the most traffic for MetroPCS, as well as one it believes will encourage customers to upgrade to unlimited. (See MetroPCS Gives Video the 4G Treatment.)

Chao told LR Mobile last month that data congestion on its LTE network is not yet a concern for the contract-free carrier, so its pricing changes are likely motivated by making money rather than alleviating congestion. MetroPCS has found that its customers will pay for video, and is banking on the unlimited data to offset the higher price. Plus, its $70 plan is still lower than larger competitor Verizon Wireless 's highest tier at 10GB for $80 per month, although its $60 tier for 5GB is $10 more expensive than both Verizon and AT&T Inc. (NYSE: T)'s offers . (See MetroPCS Continues 4G Price War.)

For more

— Sarah Reedy, Senior Reporter, Light Reading Mobile

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