T-Mobile Ending All Overage Charges, Challenging Rivals to Follow

Monday April 14, 2014 9:56 AM PDT by Kelly Hodgkins
T-Mobile is kicking off a new campaign targeting overage fees as part of its ongoing Uncarrier initiative that aims to disrupt the wireless industry in the U.S. Starting in May, the U.S. carrier is eliminating overage charges for all its customers regardless of their cellular plan. The wireless carrier also challenges its competitors to do the same.

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With this move, T-Mobile is abolishing those additional charges that are levied when a customer exceeds their available minutes or allotted data for their cellular plan. These extra calling minutes or gigabytes of data are charged at a much higher rate and can easily add hundreds of dollars on to a customer's base monthly bill. Estimates cited by T-Mobile suggest consumers paid up to $1 billion in penalties last year for these punitive charges.
"Charging overage fees is a greedy, predatory practice that needs to go," continued T-Mobile CEO John Legere. "Starting in May for bills arriving in June - regardless of whether you're on Simple Choice, Simple Starter or an older plan, we're abolishing overages for good. Period."
Besides removing overage fees, T-Mobile's Legere also started an online petition that asks AT&T, Verizon and Sprint to end overage fees, saying they are "no longer welcomed in this industry."

This petition is part of a larger initiative by T-Mobile to shake up the cellular industry in the United States with a series of promotions and policy changes, including ETF buyouts for customers who switch from a rival carrier, early upgrades and no-contract cellular plans.

Top Rated Comments

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Posted: 8 months ago
The cable industry needs a T-Mobile.
Rating: 35 Votes
Posted: 8 months ago
Go T-Mobile! You guys are shaking it up. Other carriers should be worried.
Rating: 13 Votes
Posted: 8 months ago

with this new plan isn't t-mo simply cutting off your data and letting you buy some more instead of throttling you or charging you an overage fee?


So how does this work then? I assume you are still going to pay for the extra data when you go over...but is it just at the same rate as your initial package?


I'm confused. Without overage charges, what's to prevent me from getting the cheapest data plan and using all the data I want ?


The deal is that they throttle you to EDGE speeds when you reach your allocation, and then they call their plans "unlimited data."
Rating: 7 Votes
Posted: 8 months ago
You really gotta like T-Mobile. They're running a carrier the way carriers should have been run from the start, if the industry hadn't been mired in a consumer-hostile mess enabled by rampant collusion for so long.

Their coverage isn't very good, but it's good enough where I live to make me glad I'm a customer, and their international roaming is so far beyond what anyone else offers that there isn't even any competition for those of us who travel.
Rating: 6 Votes
Posted: 8 months ago

I'm confused. Without overage charges, what's to prevent me from getting the cheapest data plan and using all the data I want ?


They throttle you down to edge speeds. If you look at their current plans, the amount of data you pay for is what you'll get at full speed. The reason it is still appealing is that you have a predictable bill. If you go over, service may suck. It just won't end with sticker shock. I don't think that's a bad system.
Rating: 4 Votes
Posted: 8 months ago

Such greedy policies were NEVER "welcome". They were done because they COULD. Just like how my credit union charges me $30 if I don't have enough money in my checking account to make a payment from my savings, or at all, for that matter. Charging people fees for not having money is, and always has been, greedy and illogical. The only place crap like this is ever "welcome" is in corporate board rooms. If not for the successes of these companies, they wouldn't have started all these abusive practices in the first place. But these "service provider" companies are at the top of the list in the corporate brotherhood of "fees and other additional charges". Once one is big enough to do it without losing too many customers, the rest follow suit to make sure they're not missing out on a revenue stream.

There's so much like this going on in capitalism that it's nice to see at least one company trying to do what capitalists claim is at the core of the system: be competitive by being BETTER in some way. They can't be better on a technical level? Well, then be better to customers and appeal to new customers that way. Sad.

But billions have already been extracted from consumers by these companies with these unethical and consumer abusive techniques, and if T-Mobile fails to win people over with this strategy (or even more likely, if they became an industry dominator), I'm sure corporate "governance" would decide to reinstill these abusive fees just to increase profit margins once their profit increases started leveling off year over year. That's WHY these fees and other abuses EXIST in the first place! That's also why they'll eventually return. Never trust capitalism to do the right thing for YOU the consumer, and never trust it to let you pay the same amount every month, regularly, because they'll change the deal on you the moment it stops getting them a lot of new subscribers, and they'll increase prices just to increase profit, NOT because the cost of running the business increases (my DSL and phone combo bill has gone from $50 per month to $72 per month between 2005 and 2014, and the quality of services and data speeds have only degraded, and I've fought various fees for crap I never asked for; yet Verizon has been making greater profits hand over fist year after year; like the lies of the petroleum companies, they're not struggling, it just makes them greater profits to make their customers struggle).

Still... Hooray for T-Mobile... If they weren't a struggling carrier, it might look like something other than an act of desperation to actually treat their customers better than their competitors do. No, I don't take this as proof that capitalism works, and I don't see what this has to do with Apple/Mac news. Maybe if Apple became a cellular carrier...


Much of what you wrote here is nonsense. You are welcome to jump on the defeatism train. But you are the source of your own woes.
Rating: 4 Votes
Posted: 8 months ago
I want to marry T-Mobile.
Rating: 3 Votes
Posted: 8 months ago

It's funny, when AT&T does it with their grandfathered unlimited data plan, it's false advertising and misleading. When T-Mobile does it, it's revolutionary and shaking up the wireless industry.


The difference is:

- AT&T changed their truly unlimited data plan to throttled. It wasn't advertised as being throttled when customers originally signed up for it. It was advertised as $30 all you can eat data and then changed when AT&T couldn't handle the data traffic. T-Mobile's throttled data plans are advertised as being throttled after a certain limit is reached.
- AT&T no longer offers that unlimited data plan either. New customers can only sign up for plans that include data caps with overages

Bottom line is that AT&T/VZW will not be dropping their overages. It's a huge source of revenue for them. As data speeds get faster, customers can either purchase more data or risk more overages. Either way it's a win/win for AT&T/VZW.
Rating: 3 Votes
Posted: 8 months ago
Such greedy policies were NEVER "welcome". They were done because they COULD. Just like how my credit union charges me $30 if I don't have enough money in my checking account to make a payment from my savings, or at all, for that matter. Charging people fees for not having money is, and always has been, greedy and illogical. The only place crap like this is ever "welcome" is in corporate board rooms. If not for the successes of these companies, they wouldn't have started all these abusive practices in the first place. But these "service provider" companies are at the top of the list in the corporate brotherhood of "fees and other additional charges". Once one is big enough to do it without losing too many customers, the rest follow suit to make sure they're not missing out on a revenue stream.

There's so much like this going on in capitalism that it's nice to see at least one company trying to do what capitalists claim is at the core of the system: be competitive by being BETTER in some way. They can't be better on a technical level? Well, then be better to customers and appeal to new customers that way. Sad.

But billions have already been extracted from consumers by these companies with these unethical and consumer abusive techniques, and if T-Mobile fails to win people over with this strategy (or even more likely, if they became an industry dominator), I'm sure corporate "governance" would decide to reinstill these abusive fees just to increase profit margins once their profit increases started leveling off year over year. That's WHY these fees and other abuses EXIST in the first place! That's also why they'll eventually return. Never trust capitalism to do the right thing for YOU the consumer, and never trust it to let you pay the same amount every month, regularly, because they'll change the deal on you the moment it stops getting them a lot of new subscribers, and they'll increase prices just to increase profit, NOT because the cost of running the business increases (my DSL and phone combo bill has gone from $50 per month to $72 per month between 2005 and 2014, and the quality of services and data speeds have only degraded, and I've fought various fees for crap I never asked for; yet Verizon has been making greater profits hand over fist year after year; like the lies of the petroleum companies, they're not struggling, it just makes them greater profits to make their customers struggle).

Still... Hooray for T-Mobile... If they weren't a struggling carrier, it might look like something other than an act of desperation to actually treat their customers better than their competitors do. No, I don't take this as proof that capitalism works, and I don't see what this has to do with Apple/Mac news. Maybe if Apple became a cellular carrier...
Rating: 3 Votes
Posted: 8 months ago

The deal is that they throttle you to EDGE speeds when you reach your allocation, and then they call their plans "unlimited data."


How is that not unlimited data? You can still download anything you want to without any additional fee or cost. If you want more high speed data, pay for it, but they're not going to charge you an overage for going past your high speed data limit.
Rating: 3 Votes

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