Why is Everyone Excited About T-Mobile Becoming the "Un-Carrier"?


Q: What’s the big deal about T-Mobile not having contracts any more? From what I’ve read, you still have to pay for the phones over the course of two years or you get hit with a steep penalty? What’s the difference?

A: At most major carriers in the US, you can buy a phone at full price, or you can buy the same phone at a steeply discounted price and sign a two year contract with the phone company. The only difference is that if you pay full price, you’ll probably be able to get the phone “unlocked.” Since you’ll pay the same for your phone service either way, there’s no financial incentive to do anything else, and most folks just sign a two year contract. What T-Mobile did gives people a choice. You can get a new phone for cheap upfront and pay a little every month, or you keep using your old phone and save money. So, should everyone run out, and switch to T-Mobile? No, it’s a bit more complicated than that.

Depending on how much data you need, T-Mobile might not be the best choice for you. Unfortunately, you have to look at all of your options at all four carriers to see what your specific situation looks like. However, if you want unlimited data, T-Mobile is the cheapest by far. However, if you are a heavy data user, you might not find T-Mobile to be adequate for you. T-Mobile's data coverage area is much less built out than the other carriers.  Also, something to keep in mind is that if you're not paying the full price for the phone, instead of signing a two year contract, you're signing a two year, interest free loan. If you don't pass the credit check, you're not getting that shiny new smart phone.  

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