T-Mobile imposes $5 monthly price hike on customers using older plans

T-Mobile today is notifying customers on some older smartphone plans that their monthly prices will soon be increased by either $2 or $5.

T-Mobile confirmed the price increases when contacted by Ars today. “The increase is $2 or $5 per line. We won’t be sharing the details on which plans but the portion of customers who are included are being notified today,” a T-Mobile spokesperson told us.

The price increases, which reportedly will take effect during the June billing cycle, were previously confirmed by The Mobile Report. The news article said that affected plans include One, Magenta, Magenta Max, Magenta 55+, Magenta First Responder, and Simple Choice. While smartphone plans will increase either $2 or $5, it appears that affected plans for tablets and hotspots will get a $2 price increase.

Customers whose prices are going up are being notified via text message. An internal presentation obtained by The Mobile Report said, “Costs and inflation have risen over the past decade; even with this small increase we still offer the lowest price versus AT&T and Verizon. Customers will still retain all their benefits and perks.”

T-Mobile customer service reps are being instructed to tell users that “costs are rising, and we haven’t touched plan prices in nearly a decade. Even as we’ve kept prices steady, we’ve continued to pack our plans with value and build out the industry’s best 5G network.” The price hikes affect “some of our oldest rate plans for a fraction of our customers,” the internal document said.

CNET reports that the price hikes were described in an internal memo sent by Consumer Group President Jon Freier. “The note doesn’t list which plans are affected, but Freier specifically says that those on the carrier’s latest assortment of Go5G plans will not see their prices increase,” CNET wrote. “The same goes for the ‘millions of customers’ who are covered by T-Mobile’s Price Lock guarantee, which he says will continue to be in effect for those people.”

CNET further notes that users “affected by the price hike will be able to call up to change their plans to newer T-Mobile offerings, but they won’t be able to opt out of this increase.”

Rising prices

In October 2023, T-Mobile decided to move some customers to newer, more expensive plans unless the users called the company to opt out. T-Mobile dropped that plan after hearing extensive criticism.

T-Mobile bought Sprint in 2020, reducing the number of major nationwide carriers from four to three. T-Mobile completed an acquisition of prepaid carrier Mint Mobile a few weeks ago and is reportedly in talks to buy a portion of the regional carrier US Cellular.

A recent report by Finland-based research firm Rewheel detailed rising mobile prices in various countries, and it said that consolidation in the US has harmed users.

“Five years on, the Sprint/T-Mobile 4-to-3 mobile merger made the US one of the most expensive mobile markets in the world,” Rewheel wrote, according to Light Reading. “While monthly prices were falling and continue to fall across mobile markets and while the same was true in the US mobile market prior to the merger, after the merger prices in the US either stopped falling altogether or fell at a much slower rate. The 4-to-3 mobile merger in the US led to higher prices and consumer harm.”