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T-Mobile's Free Roaming Plan: The Catches

Oct 10, 2013 (06:10 AM EDT)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=240162495


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T-Mobile dropped another bomb on the wireless world Wednesday when it announced its latest UnCarrier initiative: free mobile data and messaging for international travelers. The company hopes to eliminate "bill shock," one of the industry's thornier issues. As always, however, the devil is in the details.

Beginning October 31, all customers who subscribe to T-Mobile's Simple Choice plan will automatically have access to free mobile data, free messaging and low-cost voice calls in 115 countries around the world. T-Mobile says the plan covers 98% of the destinations to which Americans travel, including all of North America, most of Central and South America, all of Europe, various Asian/Pacific countries and a handful of countries in Africa and the Middle East. China, India, Japan, and Russia are included.

Typically, Americans who travel overseas are subject to outrageous roaming fees. For those careless enough to use their devices abroad without first subscribing to an international rate plan, the bill can be quite painful. T-Mobile CEO John Legere was all too happy to tell the story of one AT&T customer who downloaded a movie when traveling overseas and was socked with a $62,000 bill upon return. Similar bill shock stories crop up each summer when people travel in greater numbers.

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Even travelers who do subscribe to an international roaming plan can get soaked. For example, AT&T charges travelers $30 per month for 120 MB of roaming data, $60 for 300 MB, or $120 for 800 MB. Those fees are incurred on top of the already existing monthly service plan.

If you're wondering how T-Mobile can offer international roaming for free, there's a big catch: speeds are limited.

T-Mobile's plan lets users roam for free, but only at EDGE/2G data speeds. We're talking speeds that are about 100 Kbps. For comparison, LTE 4G speeds can top 50 Mbps. Roaming at EDGE speeds, even for free, is practically useless. If you want fast mobile data when traveling, you'll have to cough up some money. T-Mobile offers Speed Passes that can be used to access faster data. It charges $15 for a daily pass that gives customers up to 100 MB of 4G data. The weekly pass costs $25 and includes up to 200 MB of 4G data, and the monthly pass costs $50 and includes up to 500 MB of 4G data. Those rates aren't unreasonable and are less expensive than similar options from AT&T, Sprint and Verizon, but they certainly aren't free. Oh, and don't even think about tethering.

There are some other interesting caveats worth pointing out. T-Mobile is offering one rate for voice calls when roaming: 20 cents per minute, limited to regular calls between two standard lines. It doesn't include local and foreign taxes, which may pump up the bill a bit. Calls and text messages sent to other U.S. numbers are free, but cost 20 cents per minute/message when sent to non-U.S. numbers.

Despite these hooks, T-Mobile's offer isn't unreasonable. After all, allowing its customers to roam overseas does cost T-Mobile money. The company can be excused for sticking a few fees in the small print. Free data at slow speeds may be acceptable for some people when traveling, but it probably won't work for power users. In those cases, T-Mobile's Speed Passes offer reasonable rates for faster mobile data. T-Mobile's customers can now travel without the fear of "bill shock" when they get home.