T-Mobile has announced that it will be raising prices on older plans for the first time in nearly a decade to keep up with rising inflation and costs. The rate increase will affect a small portion of customers, with voice lines going up by $5 and connected devices increasing by $2 per month. Customers with free lines will not see any increases on those lines, and the price hike is set to go into effect on June 5. While affected customers will not be able to opt out of the increase, they will have the option to change their plans to newer offerings. Last year, T-Mobile attempted to move customers on older, cheaper plans to newer, pricier ones, but faced backlash and ultimately backed off the plan.
The announcement of the price hike comes after speculation from T-Mobile’s Chief Financial Officer Peter Osvaldik at a recent conference. The company has been hinting at raising prices since the completion of its merger with Sprint in 2020, with the legal requirement to not raise prices for three years coming to an end. T-Mobile has since introduced its Go5G assortment of plans, which are pricier than its earlier offerings. While new customers can still sign up for older or cheaper plans, such as Magenta, Magenta Max, and Essentials, these options are not prominently displayed on the company’s website.
Since the T-Mobile/Sprint merger, the US wireless market has become one of the most expensive mobile markets in the world, according to a report from Finland-based research firm Rewheel. While this price hike is the first from T-Mobile, its rivals, such as AT&T and Verizon, have already made multiple increases to their plans over the last few years. AT&T and Verizon have raised rates for their latest plans and made other rate increases for older plans, pushing customers to switch to newer, more expensive wireless plans. The price hikes from these carriers have contributed to the increasing cost of mobile services in the US market.
T-Mobile has assured customers that beyond the higher prices, there will be no other changes to their plans. Customers who are affected by the price hike will be notified by T-Mobile and will have the option to change to newer offerings but will not be able to opt out of the increase. While the exact number of affected customers is unknown, T-Mobile has stated that it will be a small portion of its customer base. The company’s decision to raise prices on older plans reflects the industry trend of shifting towards more expensive wireless plans, as carriers look to offset rising costs and remain competitive in the market.
Overall, T-Mobile’s decision to raise prices on older plans marks a significant shift for the company, which had avoided rate hikes for such plans in recent years. With the completion of its merger with Sprint and the legal requirement to not raise prices for three years coming to an end, T-Mobile is now looking to increase prices to keep up with rising inflation and costs. While customers affected by the price hike may not be able to opt out of the increase, they will have the option to switch to newer offerings. The move also reflects the broader trend in the industry of carriers raising prices on older plans to push customers towards more expensive options.
