T-Mobile is flouting one of the biggest taboos of the mobile industry: The monthly data allotment. T-Mobile CEO John Legere on Tuesday announced a new program called Data Stash, which allows you to roll over unused data each month into a kind of 4G piggy bank and use it for up to a year if you exceed your normal data plan in a given billing period.
Typically you buy a mobile data plan that comes with a set number of gigabytes or megabytes each month, but whatever you have left over at the end of the billing cycle disappears into the ether. That’s left consumers with two equally unattractive propositions, Legere told Yahoo’s David Pogue in a webcast interview. Customers either lowball their monthly data usage and wind up paying overage fees or they overestimate their data use and often wind up with leftover gigabytes each month, Legere said.
Data Stash will let customers bank that unused data each month. After a year, saved data does expire – January’s unused data is good until the following January — but there doesn’t seem any limit on how much data you can store up. In fact, Legere said T-Mobile would seed every customer’s Data Stash with 10 GBs when they sign up.
“It’s your data,” Legere said. “What you don’t use, you don’t lose.”
Legere spent a lot of time bashing other carriers own practices of charging data overage fees and overselling data buckets, though T-Mobile until today perpetuated the same business model for much of its recent history as well. The difference is most of T-Mobile’s plans don’t come with overage fees or additional data purchase options. Instead T-Mobile currently throttles back bandwidth to 2G speeds for any customer who exceeds their data allotment in a billing cycle. When the new billing cycle begins speeds return to normal.
Smaller virtual operators like FreedomPop have launched data rollover programs in the past, and even [company]Verizon[/company] has experimented with rollover on its prepaid plans. But no major carrier has taken a data rollover program to such a level. Selling customers more data than they can use has been a classic way of milking more money from subscribers in recent years, just as selling consumers oversized voice minute buckets was they traditional ploy of the previous decade.
The announcement is part of T-Mobile’s evolving Uncarrier strategy — technically its 8th installment — in which T-Mobile has challenged many of the established norms of the mobile carrier business, including contract and subsidy programs and international roaming fees. What will be interesting to see is if other carriers follow in T-Mobile’s footsteps as they did with its Jump upgrade program and no-contract plans.