By Charles Hall
There was a lot of hullabaloo in the press when T-Mobile announced it would unbundle its wireless service from the purchase of the phone by letting customers supply their own-separately purchased devices — mobile phones and tablets — and charge only $50 for unlimited calls, messaging and Web browsing — all without a fixed-term contract.
Upon further investigation, we found that AT&T and Verizon Wireless (VW) offered similar plans although they do not offer nearly as many models of phones as T-Mobile. So, we said, “Welcome T-Mobile! AT&T and Verizon Wireless already offer the same thing but on a more limited basis.”
Here’s a quick comparison of the three companies’ $50 a month, no contract plans that we did to show that the mainstream fuss about T-Mobile’s no-contract plan was a bit over the top:
|Unlimited talk, text, & data||Smartphone users must purchase data plan||Only the first 500MB is at 4G speeds|
|Other plans||$25/m for a plan with 250 minutes of talk and unlimited text||
|$70/m for 4G|
|$60/m for 2.5GB @4G|
|$30/m for 5GB @ 4G|
|All have unlimited talk, text,& data|
|Smartphone Plans||$65/m for 1 GB data||$60/m for 500MB of 3G data||Included in all plans|
|$70/m for 2GB of 3G data|
The Web sites that were used to prepare these charts are:
It certainly seems that AT&T and Verizon Wireless beat T-Mobile to the prepaid, no contract market but with only a limited number of phones and much less fanfare.
A New Twist: VW Gets More Aggressive
The story of the $50 a month, no contract, BYOD (bring your own device) mobile deals took a new twist the following week when Verizon Wireless said it would offer a $35 a month version. However, it’s limited to 500 “anytime” minutes of phone calls a month, which definitely won’t appeal to our readers or to me.
Next up for me was a visit to a nearby T-Mobile store to see what they have to offer. First off they do not offer a ruggedized Samsung-built mobile phone like the one I got from my current cellco, although they do offer a non-ruggedized version of it, which the rep said has the same usage time between battery charges but does not have a speaker. What they do offer is all of their phones on a $50 per month, unlimited deal.
What really caused me to back off, however, was when he immediately started asking about where I would be when I made phone calls. He said T-Mobile has more limited coverage area than other carriers, supposedly meaning Verizon Wireless and AT&T. I, like most others, don’t want to be limited as to where I can connect.
The frustrating part of this quest is that I have the phone I want — a ruggedized Samsung — and I have a cellular service that works very well — Verizon Wireless. What I don’t like is paying $90 a month to make phones calls and send messages — which Verizon recently and rather mysteriously reduced to $70 a month. I also didn’t like the way Verizon Wireless makes it hard to get their no-contract $50 a month deal:
– The rates for the monthly plans don’t display on an iPad
– Its stores don’t have the phones so that I can see them.
T- Mobile does because all its phones including smartphones are available on its $50 a month no-contract plans.
– The sales reps in Verizon Wireless store I visited are not familiar with the plans or the phones that are available for it. This turned out to be true for the store I visited, which was not a VW-owned store.
– Three phone chats with Verizon Wireless all ended with the same results. No one was knowledgeable about the no contract plan or the phones that worked with it. They all told me to call customer support or go to Walmart.
Buying a phone and signing up for a cellular service should not be so hard. The quest continued.
87,000 Sign Petition to End Cellular Contracts at Verizon Wireless
In response to Verizon CEO Lowell McAdam saying he’d consider ending all cell phone contracts if consumers asked for that, a Verizon customer named Mike Beauchamp started a blog on Change.com that has attracted 87,000 “signatures” as of Thursday morning asking for Verizon Wireless (VW) to do just that. See: http://www.change.org/petitions/verizon-get-rid-of-contracts-for-wireless-service
Beauchamp told CNN, “I believe that people should have the freedom of choice to move freely between carriers. I think that model where you tie customers in for two or three years is a tired model that doesn’t need to exist anymore.”
VW already offers a $50 a month no-contract deal much like T-Mobile but has serious shortcomings: The plan:
– Is not available on any and every phone that VW sells, unlike T-Mobile.
– Works only on a few specific phones.
– Is not available in VW stores, whose sales reps are not knowledgeable about it. That turned out to be true for the VW store I had visited that was not a VW owned store which I did not know.
– Is only available at retailers such as Walmart and online. That too turned out not to be true. VW-owned stores offer the pre-paid phones, stock the phones that run on the pre-paid plan and will activate them on the spot for free.
– Is virtually impossible to talk about with an online sales rep.
– Is impossible to chat about online with Verizon.
– Does not allow subscribers to pay for the phone on a monthly plan.
The Net: VW does not make the plan easy or attractive to sign up for. The VW $50 a month, no contract plan is available but consumers have to work to get it.
Quest Ends for $50/month, No Contract, Unlimited Usage
– What a Hassle! Nearly 20 Hours
– But It Does Exist
The next step in my quest for a $50 a month “no-contract” with unlimited usage took me, at the suggestion of a VW online sales rep and one of their store sales reps, was to Walmart. Ifinally got up the courage to go and found what I was looking for. It stocked all the $50 a month no-contract phones that AT&T, VW and T-Mobile offer. Walmart also has its own no-contract payphone service called Straight Talk for $45 a month, which has unlimited usage. It runs on AT&T or VW’s network, depending on which model of phone you select. A US map on the packing is red for VW and blue for AT&T. Walmart even sells iPhones that workon its Straight Talk plan.
Substitute for a Smartphone
Since I don’t need a smartphone — I rarely travel and own an iPad — I bought the Samsung Intensity IIIPrepaid. Even though it has only 300 minutes of usage between battery charges compared to the 420minutes of Samsung Gusto 2 Prepaid flip phone, it offers more functions: email in addition tomessaging, browsing with the Opera browser, a music player and removable memory. Mostimportantly, it has a slide-out QWERTY keyboard and is ruggedized, unlike the Gusto 1. It has ascreen but it’s not a touchscreen. See:http://www.verizonwireless.com/b2c/prepay/validateCompare.do?selectedPlanCatId=5432
The phones that VW offers on its prepaid plan do NOT run on its 4G LTE networks so they are notbest for someone that does lots of browsing or watches streaming videos. Prepaid phones only runon VW’s 3G network.
Walmart does not activate for VW so I headed home to get started. That’s whencomplications set in. I decided to call VW one last time before I activated and it’s a good thing I did. Itturns out that VW charges $35 to activate a phone purchased from Walmart, which wipes out the $35 Ihad saved by buying the phone from Walmart instead of from VW. But the real killer was the newsthat VW would not let you keep the same phone number on a phone purchased from a reseller, whichmeans that your contacts cannot be transferred to the new phone.
Back to Walmart
As a result, I decided to take the as-yet-unopened phone back to Walmart and order one from VW online. The problem with that, I was told by a VW rep, was that my current phonewould be immediately de-activated and my new phone would not arrive for four or five days. I saidthat I could not do without a phone for that long and the telephone rep said I should drive to thenearest VW store and buy one for immediate activation and delivery. I told the rep that the VW store Ihad visited the prior week had told me they did not have or know anything about pre-paid phones.After some heated discussion, I decided to call another store, which was actually closer to my home,and see if they had them in stock. They did and I sped over, after returning the same phone toWalmart. I got a full refund but had to wait in a long line for half an hour.
And Back to Verizon Wireless Again
The rep in the VW store told me that the VW store I had visited the prior week was not a VW-ownedstore but a franchise — even though it was in the biggest mall in town. How was I supposed to know?He brought out the phone, activated it and transferred all my contacts in about 15 minutes. He alsotalked me into buying a new Bluetooth headset that has HD video and a leather carrying case. Iadded on a second AC charger and one for the car. The total bill for those items was about $180 plusthe $50 for the first month’s usage. He told me I would have to set up the automatic monthlypayments at home on “MyVerizon” Web page. Simple enough, right?
Wrong! When I switched from post-paid to pre-paid VW had disabled access to “MyVerizon” so I hadto re-register. In registering I was asked for a security code, something about which I had no idea orhow to get it. So, I had to call VW all over again and painfully go through the process of registeringmanually. Once that was completed I was set. I only had to learn a few functions that the new Samsung phonehas that the old Samsung one didn’t.
One difference between VW and T-Mobile: VW subscribers must pay up-front the entire cost of the phone. T-Mobile lets subscribers pay for thephone upfront or over a period of time.
The monthly pre-paid rate at VW for a smartphone is $60 and the subscriber of course has to pay up-front forthe smartphone.
Getting a mobile phone and service should not be so hard or time consuming. Executives at VW andthe other carriers should try switching from post-paid to pre-paid on their own service and then ontheir competitors’ services.
After they do, they will no doubt go back and make changes that will save the subscriber and theirown company significant time and money.
A Very Happy Ending: Quest Plus 1
The Bluetooth headset with HD audio that I bought at the Verizon Wireless store for $130 never worked properly. The store manager checked it out and found nothing wrong but promptly agreed to take it back. I then bought the $99 Bluetooth headset she said she uses and it’s working fine. I also bought a wireline headset and came close to buying a Wi-Fi router that connects to VW’s cellular network and accommodates up to 10 devices — tablets, PCs and such — and probably get one for the next trade show I go to because hotel Wi-Fi rates are very high. Why would I switch from Verizon even though I now can at any time and without any penalty? Its cellular service and customer relations are what I had grown accustomed to during my last six years as a subscriber but which had been marred in the quest for the pre-paid deal.
It’s a pleasure to have a shopping experience like that. If I had gone to that store first, the whole fiasco that occurred in finding a $50 a month, no contract deal would never have happened. But how was I to know that the VW store in the biggest mall in town was not Verizon Wireless operated but owned by a reseller. The two trips to Walmart would have been avoided and the whole matter would have been hassle free.
VW, and no doubt the other carriers, do not make it easy to switch from their post-paid plans to their $50-a-month, no contract and unlimited-usage service. The total time I spent switching from post-paid to pre-pay was 18-20 hours, including travel and telephone time. Few people have the time, patience and persistence to endure the ordeal. The end result is that now, instead of spending $90 a month for unlimited usage on a two-year contract, I spend $50 for unlimited usage on a plan that I can cancel at any time for any or even no reason. The $40-a-month difference for 24 months is almost $1,000 that I can spend on other things. T-Mobile has a big edge over AT&T and VW in pre-paid because it offers all of its phones on that plan.T-Mobile has said it’s beefing up its cellular network to provide better coverage.
The two big cellcos do not offer all their phones on prepaid but we expect both to add more phonessoon. They will also have to offer a monthly payment plan for purchasing the phone that runsseparately from the pre-paid charges just as T-Mobile does.
The move to having customers pay full price for the phone will put pricing pressure on makers of cellphones.
But contract-free, unlimited usage phone contracts are here to stay. The sales rep at Walmart saidshe is seeing an increasing number of people whose contracts are about to expire come in and askfor them. The rep at the VW store said he also was beginning to see subscribers come in and ask forthem.
Mobile service subscribers are finally being liberated!