Glad to see someone else here who is baffled by the state of American telecom industry as I am.
So here's what i understand about the industry prior to TMobile's "innovations":
- You buy phones from the Cellular service provider, which are bundled with the service (hence apparently higher bills)
- Since the phone is bundled with the service, i assume even if you don't use the service you still pay a good amount every month.
- You have a contract with the Cellular service which forces you to stick with them till the term of the contract.
- So its usually painful to switch carriers (breaking fee etc). (Do you get to keep your old number if you switch?)
- Since you are stuck with the cellular service they can pretty much charge you whatever they want during that time. Sure they gotta give you an incentive to renew the contract but as i see it the competition between carriers isn't that much.
Now here's how things work in my country:
- You buy mobile independently and then pay for the service
- You pay the service typically below 3USD for most users. And it depends ENTIRELY on your usage. No usage = zero payment.
- No contracts with the carrier. You get to switch at the drop of a hat.
- Thing is, cellular services mostly "prepaid" (post-paid is available but few users go for that). So you just pay the service in advance what you think will use and that is credited to your account. This doesn't expire for several months so no worries about over-estimating.
- So switching a service = getting a simcard of that service, adding balance to it (which you can from any corner store).
- Oh they even let you keep the number provided by the old carrier so virtually no switching costs.
- Hence the competition here is unimaginable! "Price war" would be an understatement. They even keep giving incentives to inactive customers to plug in their old sim cards.
- Its so freaking affordable people buy multiple-sim cellphones so they can use multiple services at the same time (hence utilizing best of each provider)