Did T-Mobile Just Introduce the Cheapest Prepaid Wireless Plan From a Major Carrier?

Usually when T-Mobile (TMUS 0.55%) CEO John Legere makes an announcement, he says something that changes the entire wireless industry.

That happened as recently as mid-December, when Legere announced that all subscribers would have their monthly data allotment rollover if they don't use it. Doing that forced AT&T (T 1.17%) to respond by offering to a similar plan for its customers -- likely to keep them from leaving for T-Mobile.

T-Mobile's latest announcement -- "Simply Prepaid" -- offers prepaid wireless plans with unlimited talk, text, and data (sort of) starting at $40. The caveat on the data is that T-Mobile sells its customers an allotment of 4G LTE high-speed data with its plans and, when they use it, throttles down their speeds dramatically.

The new prepaid plan comes with 1GB of 4G LTE data for $40, 3GB for $50, or 5GB for $60.

It's a decent offer -- a good one when you consider that the company has eliminated add-on charges with its data offer -- but may not be the best prepaid deal from a major carrier. Whereas T-Mobile has been revolutionary in its past offers. This one seems a little more pedestrian -- still good for customers, but perhaps not really worthy of Legere's bluster.

We're staying in prepaid's 1st place. #sorrynotsorry #SimplyPrepaid http://t.co/uzuFScfqOu

— John Legere (@JohnLegere) January 15, 2015

T-Mobile vs Sprint

Legere has made passing Sprint (S) to become the third largest wireless company one of his goals for 2015 and winning over some of its wireless customers would help. But from a pure price basis, Sprint actually has a cheaper prepaid offer.

*After high-speed data is used. T-Mobile provides unlimited data at a slower speed.

Sprint has the lowest-price plan and offers a better price as data increases, but it doesn't match T-Mobile's unlimited (albeit slower) data offer. Sprint's plans turn off data access when the allotment is used. That's better than the automatic overages its contracted customers are forced to pay, but it's a step down from the T-Mobile offer.

The question for customers is to whether paying an extra $5 a month is worth it in order to not have to worry about losing access to data.

T-Mobile vs AT&T

While he plans on catching Sprint this year, AT&T may be Legere's favorite target to go after and Simply Prepaid compares favorably to AT&T's "Go" prepaid offerings.

*Both companies offer unlimited data but slow speeds after a customer uses his or her allotment.

AT&T's deal is pretty much identical to T-Mobile's, except it costs more and offers less data.

T-Mobile vs Verizon

Verizon (VZ 2.85%) offers what may be the worst of all the prepaid wireless deals. The company has a single offer of $45 for unlimited talk and text along with 500 MB of high-speed data. That's a higher price than T-Mobile's cheapest offering for less data.

In addition, once the scant 500 MB of data is exhausted, access is shut off and customers have the option of buying more -- $5 for another 500 MB, which expires in 30 days, $10 for 1 GB which can be used over 90 days, or $20 for 3 GB with the same 90-day terms.

Verizon's offer costs more than all the other carriers except AT&T, which offers its entry-level plan for the same $45, but with more included data.

A Top Competitor

While T-Mobile's offer is not clearly the cheapest plan from a major carrier, it's cheaper than AT&T and Verizon. The Sprint plan costs less, but it only makes sense for someone who knows he or she will use less than 1 GB of data a month.

Legere may not have changed the game with Simply Prepaid, but he delivered a plan that's more than fair at a price that's extremely competitive among the major carriers. Simply Prepaid also comes with less hassle than the cheaper Sprint plan. You can simply buy and it use it without having to worry about buying more data.

For most customers, Simply Prepaid is the best prepaid wireless value from a major carrier, and that should help T-Mobile continue its growth streak.