MetroPCS to Overhaul Monthly Plans Next Monday, Adds Throttling on LTE

Internal MetroPCS documentation has leaked detailing a set of new service plans that the flat-rate carrier will roll out on Monday that will reflect the increased costs of providing its LTE services to its customers as well as the fallout from its failed purchase led by Sprint CEO Dan Hesse late last February.

via HowardForums

Starting with its $40 rate plan, data access will no longer be tiered by application or service and all data access will now count against the data allotment allowed in the plan, with the aforementioned plan now being limited to 250MB at 4G speed before being throttled to either 1x or EVDO speeds depending on local market. The $50 plan ups the data allotment to 2.5GB before being throttled, the $60 plan goes up to 5GB before throttling and the $70 plan is allowed unlimited access with a fair/reasonable use clause that still restricts P2P and tethering on an official level.

These new plans also reflect the increasingly marginalized position that MetroPCS finds itself in as evidenced by the failed Sprint purchase and merger as the carrier continues to struggle with a lack of spectrum for its 4G LTE network and the consequences of those constraints. Because of the situation it finds itself in,  it has had to delay its long-planned transition to VoLTE from this month to the second half of the year due to a lack of short-term capital and is having to roll out EVDO in select markets in order to ease the network congestion issues it faces for those markets that do not have LTE access.

In short, MetroPCS is having to scramble to maintain its network in the short-term in order to buy time to finish its transition to LTE across its native footprint and subsequently roll out VoLTE in order to move away from CDMA 1x/EVDO service.

Another issue the carrier faces is that even though it’s making the biggest marketing push it has made to get customers to use its LTE network, executives have confirmed that out of 9 million current subscribers, only 500,000 are actively subscribing to the LTE network, which it actively attributes to the current high cost of LTE equipped smartphones and has announced a plan to work with its manufacturer partners to lower the R&D and wholesale costs of such phones in order to drive more customers to the service.

As an example, the least expensive LTE equipped phone on the MetroPCS line up is the Samsung Attain 4G Android smartphone at $219.99 and the carrier wants to drive costs for phones equipped with LTE down to the $150 or less level before additional taxes.

While most will say that the key advantage and reason for the higher costs with MetroPCS in comparison to other providers is access to its 4G LTE network, the  real-world speeds leave much to be desired, as the limited spectrum available in each market means that speeds are much lower than expected for LTE, typically between 4-6 Mbps, while AT&T and Verizon LTE networks routinely average 15Mbps+ on the low end and up to 50Mbps at the high end, making MetroPCS look like the odd man out, despite beating Verizon to the punch when launching LTE by mere days in October 2010, in a desperate attempt to maintain relevance in the market.

With the service plan realignment signaling a cost increase across the board and getting closer to average postpaid monthly rates, MetroPCS will have a harder time to compete with increasingly competitive services such as Tracfone with its GSM BYOD program at $45 a month for unlimited voice/messaging/web access and Boost Mobile’s $45 Monthly Talk/Text plan with Shrinkage as key alternatives to the ever increasing costs of service on MetroPCS. Can the carrier hope to increase revenues with these new plans, or will the carrier struggle to remain relevant as more established carriers open up to or establish MVNOs that are routinely undercutting them by the month despite featuring its trump card LTE service?

PhoneNews.com has reached out to the MetroPCS Media Relations team for further clarification and details on the service plans and will update this story when a response is received.