Yeah, it does sound good compared with the offerings by the other big companies, e.g., at&t and verizon, but the network currently sucks, even in major cities in the bay area. While it's doubtless getting better, the coverage is sorely lacking.
More focused on this topic concerning the pay it upfront instead of relying on the subsidized prices model of the major carriers, this could be beneficial and maybe even attract some frugal-minded people willing and able to pay the upfront cost for the phone instead of being spanked by the "hidden" costs of the phone companies (even/especially after) your two-year contract is up. It could work.
But I'm dubious whether this model will actually take hold for a couple of reasons. The key one is that most people just don't do the math regarding these things, or, if they do, they just don't have the available cash to afford to pay the upfront costs to even consider participating in such a potentially over the long run cash-saving investment instead of the costly alternative, which is unfortunate. Most people aren't informed of the fact that with subsidization there are sometimes very steep costs (sometimes intractable ones since you're usually stuck in a minimum two-year contract, which pretty much, if you cancel early, costs you ~200 to get out of it. Most of the time, the two-year contract penalty for early termination seems obviously just a cheap psychological ploy to get people to stick with them while, in the meantime, the customer just hemorrhages money. The upfront cost is steep enough to convince most people to just grin and bear it until some future time when their particular contract expires.).
What should be done away with is the two-year contract and cancellation fee. Maybe this will happen as a result of t-mobile's shift--might be too early to tell. Also, and this may already exist, individualized plans should exist by now. Why don't cellphone carries let you know when the plan your paying for just doesn't fit you right, that is, if you're not using that much data, why pay for it? If you fall below a certain amount of data in a given month but pay for a higher amount of data typically, why don't you get money back or a decreased bill at the end of the month? It doesn't make sense to me. It's in the cell phone company's best interest not to let you know these things, and, if you're like me, it's a burden to check and most times you get lazy and just forget to--certainly people are often sloppy when it comes to these matters and people who aren't well-versed in these topics often get taken advantage of. Anyway, point is: I'm sort of surprised that consumer advocacy groups haven't been more vocal in cell phone company issues like these, which are tailored chiefly to suck money from people and prey on those who can't afford to opt out of their policies.
So yeah, dubious if this works. I think it'll work for a very small percentage of people. I think that the percentage of people who can afford to pay upfront just won't want to because they just won't want to switch from at&t or verizon or sprint. I think it's more likely that the other big three will just adopt some form of this service or add it as an option eventually and t-mobile, at least from my naive perspective, would again be a fourth place phone company in the U.S. relative to the other three.