JR Raphael

What T-Mobile's shake-up means for prepaid smartphone service

March 27, 2013 1:31 PM EDT

T-Mobile New PlansT-Mobile's new Simple Choice plans are supposed to be all about simplicity -- but man, they sure are causing a lot of confusion.

The new contract-free plans, officially unveiled this week, bring down the base price of cellular service by separating out the cost of a new phone. One of the most perplexing things to figure out, though, is what that change means for the carrier's prepaid service, which had already offered a similar a la carte-style setup.

The answer isn't easy to find -- but after chatting with a T-Mobile media relations rep and several customer service agents, I've finally gotten to the bottom of it. Here's everything you need to know.

T-Mobile's prepaid plans are still available.

Prepaid plans are no longer prominently displayed on T-Mobile's website, but fear not: They are still there. (They're hidden under a link labeled "Pay in Advance" at the very bottom-right of the home page.) A T-Mobile representative confirmed to me that the prepaid plans aren't going anywhere; they'll just no longer be widely advertised or promoted.

That said, the prepaid plans have a new name -- they've shed their "Monthly 4G" moniker and are now just called "prepaid plans" -- and some things have changed with the way they're structured.

T-Mobile's prepaid plans are now very similar to the carrier's postpaid plans.

At a glance, it's actually hard to see how T-Mobile's tweaked prepaid plans differ from the carrier's new Simple Choice -- a.k.a. postpaid -- offerings.

On the prepaid side, you now have the following options:

  • $30/mo. for 100 minutes, unlimited texting, and unlimited data with the first 5GB at 4G speeds
  • $50 for unlimited minutes, unlimited texting, and unlimited data with the first 500MB at 4G speeds
  • $60 for unlimited minutes, unlimited texting, and unlimited data with the first 2.5GB at 4G speeds
  • $70 for unlimited minutes, unlimited texting, and unlimited data at 4G speeds

On the postpaid side, meanwhile, the new Simple Choice plans provide the following options:

  • $50/mo. for unlimited minutes, unlimited texting, and unlimited data with the first 500MB at 4G speeds
  • $60/mo. for unlimited minutes, unlimited texting, and unlimited data with the first 2.5GB at 4G speeds
  • $70/mo. for unlimited minutes, unlimited texting, and unlimited data at 4G speeds

Other than the presence of the $30/mo. plan on prepaid, the two lineups look nearly identical, right? Hang on, though: There's more than meets the eye.

T-Mobile's prepaid and postpaid plans do have some differences -- like their availability of mobile hotspot functionality.

All right, this is where the real detective work comes in, as T-Mobile's website isn't exactly forthcoming with this info -- but beneath the surface, the carrier's updated prepaid plans and new Simple Choice postpaid plans have some important differences.

The first revolves around mobile hotspot functionality. If you want to use your phone as a mobile hotspot with T-Mobile's prepaid plans, here's what you're looking at:

  • $30/mo. plan: Hotspot functionality is not officially available*
  • $50/mo. plan: Hotspot functionality is included and uses the same data pool provided with the plan (up to 500MB of 4G data)
  • $60/mo. plan: Hotspot functionality is included and uses the same data pool provided with the plan (up to 2.5GB of 4G data)
  • $70/mo. plan: Hotspot functionality is not officially available*

On the postpaid side, things are slightly different:

  • $50/mo. plan: Hotspot functionality is included and uses the same data pool provided with the plan (up to 500MB of 4G data)
  • $60/mo. plan: Hotspot functionality is included and uses the same data pool provided with the plan (up to 2.5GB of 4G data)
  • $70/mo. plan: Hotspot functionality is included but limited to 500MB of 4G data; you also have the option of paying an additional $10/mo. to get an extra 2GB of high-speed hotspot data (that option is not clearly listed on T-Mobile's website but can be activated by calling the company once your service is up and running)

So, to sum up, then, on T-Mobile's prepaid plans, you don't officially get any option for hotspot functionality on the $30/mo. or $70/mo. options, whereas the postpaid plans provide hotspot functionality at all levels -- albeit with a fairly low limit on the $70/mo. setup. That low limit can be expanded if you want to pay an extra 10 bucks per month.

*With Android, you may be able to activate hotspot functionality on your phone regardless of official availability, though such rule-breaking can't officially be endorsed and may or may not eventually catch the carrier's attention and result in severe corporal punishment (or, you know, the carrier just blocking the functionality so you can't use it without paying).

NEXT PAGE: Different features, different discounts, and which is the better deal

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