Post date: Jul 20, 2011 5:23:37 PM
As some of you might already know, I was seriously considering cancelling my cellphone service not too long ago. My HTC EVO 4G had started randomly rebooting, so I had to send it in to HTC for repair. During the couple of weeks it was gone, I decided to take a critical look at my cellphone bill to find out what, exactly, I was paying for, and determine whether any alternatives existed. I quickly came to the conclusion that I was being ripped off, so I decided that I was going to go without a cellphone for a while. But once I had my Evo returned, I was reminded of how much I enjoyed the device, and I begrudgingly decided to stick with my current cellphone plan, at least for the time being. While I'm not changing my cellphone plant just yet, I thought I would go ahead and share some of my findings here, just in case any of you are interested in these kinds of things.
To start with, I’ll give you a little background on the device and plan I am currently using. In October of 2010, I received the HTC EVO 4G as a gift from my parents for my birthday. As I am somewhat of a technophile, I was quite thrilled to be coming into possession of such a powerhouse of a device (my previous phone, the iPhone 3G, had recently been crippled by the iOS 4 update). Unfortunately (for me), receiving the Evo also signified my being dropped from my parents’ family plan. As the Evo is offered through Sprint, I was required to sign a two year contract of which I have outlined in the table to the right.
In addition to being somewhat of a technophile, I am also rather obsessed with finding good deals. Both of these tendencies are clearly genetic, as my dad and younger brother are also gadget junkies who find pleasure in getting good deals on high-end items (we don’t buy cheap crappy stuff, we buy nice stuff at discounted prices). Upon receiving my first cellphone bill, I couldn’t help but get the feeling I was being ripped off. So while my Evo was off for repairs, I decided to do some research.
The first thing I did was examine my usage statistics. I wanted to determine exactly how many of those 450 anytime minutes I was actually using, while also finding out what “unlimited” actually meant in terms of my personal texting and data usage rates. The table to the right summarizes my stats.
As you can see, I am clearly not taking advantage of my current plan. I never talk on the phone, so I obviously don’t need “450 Anytime Minutes”, let alone any minutes at all. While I did use a decent number of texts before switching to Google Voice (see footnote), the cost of texts are actually one of cellphone providers’ most blatant scams. As this CNNMoney article points out, texts are one of the most highly marked up products available to Americans. On per text plans, the markup can be as high as 6,500%. The reason this markup is so astronomically high is because the amount of data in a text is so small[3] that it costs carriers virtually nothing (1/3rd of a cent, actually, see the CNNMoney article) to transfer. So even if you are only paying $10 for a monthly texting plan, you would have to send 3,030 texts per month to be getting your money’s worth.
This brings me to the data plan. Because I essentially use my smartphone as a miniature tablet (i.e. for everything but talking), data is pretty much all I want. So I decided to see if any carriers offered data only plans for smartphones. Unfortunately, cellphone carriers are all about locking smartphone users into two year contracts with voice, text, and data, so I could only find one data only plan for high-end smartphones. Tablets, however, have quite a selection of rather appealing data only plans, which I have summarized in the table to the right.
It’s kind of sickening to see how much money I could have saved over the past nine months if I had only had the option to use a data only plan. Even the sole data only plan for smartphones, offered by Verizon, which allots way more data than I would actually need, would have already saved me $270. The plan I would probably buy, if I had the option, is the $20 1 GB per month plan offered by Verizon. Such a plan would save me a ridiculous $59.99 per month, $539.91 over nine months, and $719.88 (!!) per year.
Anyway, that’s the current state of affairs. It’s worth noting that T-Mobile is dropping the cost of their smartphone voice, text, and data plan to $59.99, which is $20 cheaper than what I currently pay for what is essentially the same service. Hopefully this is an indication that carriers will actually start cutting into their outrageous profits in order to offer competitive prices for consumers. If you have any comments, please share!
[1] In June, I started using Google Voice to handle my texts. Google Voice processes texts as data, so they do NOT count towards my monthly allotment of texts provided by Sprint. As a result, I am currently using zero texts per month while using Google Voice.
[2] Data usage only refers to data consumed over the network. As Hannah can attest to, I abuse my smartphone at home, using it to both surf the web and to stream content (e.g. Netflix). When I am not home (and, therefore, on the network), I typically use my phone for things like checking various accounts (Gmail, Facebook, etc.), using the GPS for either navigation or finding things around me, browsing the web out of boredom, and fact-checking, all of which are pretty data cheap, hence my low monthly data usage.
[3] 190 bytes according to Wikipedia, which is 0.185546875 kilobytes, or approximately 0.005% the size of your favorite mp3