T-Mobile allows customers to watch video without data charges

T-Mobile (TMUS) announced a new program on Tuesday to allow customers to watch many popular online video services on their phones without counting against their monthly data allowances.

The new "Binge On" service, which will include HBO, Hulu, Netflix (NFLX) and ESPNamong others, will show video in slightly lower quality, comparable to a DVD, not a high-definition TV picture, T-Mobile CEO John Legere said at an event in Los Angeles. The Binge On service starts Nov. 15 for new customers and Nov. 19 for all existing customers on monthly Simple Choice plans who pay for at least 3 GB of data per month, T-Mobile said.

Legere said the service will start with 24 partners but more will be added over time. Asked if a pornographic service could be added, Legere said: "yes, of course," adding that any legal video stream could be included eventually.

YouTube was the most prominent service not included, but T-Mobile Chief Operating Officer Mike Sievert said discussions were ongoing with Alphabet's Google (GOOGL), which owns YouTube, and others. "We're going to work with all partners that want to be in," Sievert said. T-Mobile has to be able to identify video streams separately from any other kind of content for the service to operate properly, he explained, so some technical details need to be worked out before YouTube can be added.

The lower quality picture could be a risk for T-Mobile, since the newest smartphones are capable of displaying higher resolution video, Jan Dawson, chief analyst at Jackdaw Research noted. But, the headline of "free video" will be "hugely appealing for customers," he said.

T-Mobile executives insisted that the differences in video quality were indiscernable on a phone. Much online video is streamed at high resolutions dubbed 1080P,  which offers 1,080 horizontal lines of pixels per screen, and 720P, which offers 720 lines, to look good on big screen TV sets. T-Mobile's service will drop down to 480P, or 480 lines of pixels.

Similar to Music Freedom

However, the Binge On service will automatically default to the normal, higher resolutions if a user shifts their phone onto wifi from the mobile network. And customers can use a T-Mobile app to turn off the service to watch higher resolution video, if they so desire, which would then incur data usage. The lower quality 480P picture reduces the amount of data needed to transmit video by about two-thirds from a 1080P picture, Grant Castle, T-Mobile's vice president of engineering, said in an interview.

The Binge On service is similar to T-Mobile's "Music Freedom" service that lets customers use most popular streaming music services on their phones without counting against monthly mobile data allowances. Unveiled last June, Legere said T-Mobile customers now listen to 200 million songs per day without any data charges. That service started with just a handful of partners but has steadily expanded and now includes Apple (AAPL) Music, Google Music, Sirius XM (SIRI) and Rdio.

The announcement was part of the 10th iteration of Legere's "Uncarrier" strategy that started back in 2013 when the carrier stopped making customers sign up for two-year contracts.The company also doubled the amount of data included with most of its monthly plans as part of Tuesday's announcement./Yahoo finance