Does T-Mobile have too many plans?

T-Mobile announced on Tuesday that it is rolling out a cheaper unlimited plan for users, which undercuts both Verizon’s and AT&T’s unlimited plans. In fact, the plan even undercuts their own T-Mobile ONE plan, though it does offer fewer services.

This plan marks T-Mobile’s fourth unlimited plan, which is certainly more than most carriers provide. The T-Mobile Essentials plan will be $60 for one person or $30 per person for a family of four, and it will offer unlimited minutes, texting, and data. Although the T-Mobile ONE plan is $40 per person, it does not have the family option. The same goes for their other two plans.

T-Mobile CEO John Legere explains, “The other guys have got Above Unlimited, Unlimited Plus, Beyond Unlimited, Unlimited and More … Unlimited and More Premium. No wonder nearly half of Verizon and AT&T customers are still stuck on data bucket plans with overage penalties. The other guys make it so confusing! [T-Mobile] wants to make it easy. Give customers the options they want … but keep it simple.”

Although this does provide a new option for consumers, this can also exhibit diminishing marginal returns. When consumers face too many options, they can get confused and look elsewhere for simpler plans. Each one of T-Mobile’s unlimited plans offers niche features, but without sifting through the details of each one, it can be tricky to determine which plan is best for a user.

In the past five days, T-Mobile’s stock price has risen over seven percent. If this can grab them more users, then they will continue their dominance as the most popular phone carrier.

Featured image via Wikimedia Commons