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AT&T Extends Price Cuts in Battle With T-Mobile for Data Users

AT&T Inc. (T) is cutting mobile-phone subscription charges for the second time in two months, seeking to hold on to smartphone customers amid a price war with T-Mobile US Inc. (TMUS)

Starting tomorrow, AT&T customers can sign up for a Shared Value plan with 2 gigabytes of data for $65 a month, down from $80. Adding a second phone to the plan brings the price up to $90, down from $105. The offer applies to both new and current customers, though existing subscribers will have to sign up again to qualify, said Mark Siegel, an AT&T spokesman.

The price reduction comes a day after T-Mobile said it will double to 1 gigabyte the amount of data alloted to its $50-a-month Simple Choice package. AT&T cut its shared data plan for families by $40 last month as it seeks to keep pace with T-Mobile’s aggressive pricing strategy. T-Mobile gained 2.1 million customers in the past three quarters, reversing its performance in 2012. The company offers a plan with 2.5 gigabytes of data for $60 a month for one phone or $90 a month for two phones.

Over the past year, Bellevue, Washington-based T-Mobile introduced a series of pricing changes to shake up the industry, becoming the first carrier to offer customers quicker phone upgrades, payment financing, international data and text-messaging at no extra charge. It also started a $450 credit program for users who switch from other providers.

AT&T, based in Dallas, is the second-largest U.S. wireless carrier, trailing Verizon Communications Inc. T-Mobile is fourth, behind Sprint Corp. Competition between AT&T and T-Mobile, which abandoned a merger attempt in 2011, has intensified in part because they use similar technology, making it easier for customers to switch devices between their networks.

To contact the reporter on this story: Scott Moritz in New York at smoritz6@bloomberg.net

To contact the editors responsible for this story: Sarah Rabil at srabil@bloomberg.net Crayton Harrison

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