Recently I switched my cell phone provider. for years I was with Verizon Wireless. The service was great for my area and the coverage is extensive. As I started to evaluate my choices I started to see a couple of trends. the 1st was data plans were being limited and the second was the costs for basic services was dropping.
Of course the first thing to look at was what do I need the cell phone for? I decided I didn’t really need data. I needed a phone that could be used to speak, text, and take messages. This changed the dynamic of my search. I went from Verizon Unlimited Data – 4G to plain old cellular. This didn’t change for my wife who decided she needed data as well.
Unlimited data is nice but, the first question we should ask is do we really use a lot of data that would warrant an unlimited plan? I tracked our data for a few months and we looked to average about 4-5 GB each on a high usage month and 2-3 GB each on a low usage month. This was not the amount I expected. I started to track where I was using the data. Most of my use was while I was at home. (Where I already had WiFi available via my ISP) This seemed redundant.
The coverage area is important. When I first purchased cellular service years ago Verizon was by far the most complete coverage. In the years to follow most of the carriers have matched their coverage in my area (Metro Atlanta). Coverage are became a non issue for me.
So the reason I looked into the cellular plan I had was costs. Verizon was charging us about $140 per month for two phones, unlimited data, & no text. We were off contract so switching would not cost anything more.
There were many companies I looked at which followed a traditional model. Republic was the first on I saw that had a new model that leveraged the increased free WiFi spots. The phone they had enabled calls to go through WiFi spots instead of cell towers for calls. Their business model was to use free data whenever possible and cut down on cellular tower usage. They bought bulk cell service from Sprint to supplement their WiFi coverage. The cost savings were then passed to the consumer.
The breakdown for us is below:
The cost difference is amazing over time. The savings I have after just two years is almost the same as my “Almost Sports Car”. ($3200 is nothing to sneeze at.) The savings over 5 years is $8000; I can think of better things to spend that money on than giving it to Verizon at a premium.
I have to admit the initial costs were a lot ($300 per phone–> $600 bucks total) but, the long term savings can justify the costs. If I was to look at it as an investment $600 enabled me to get $1000 in one year (savings). Ironically the costs of the Verizon phone was the same as the Republic Wireless phones I chose. There are three choices of phones Republic has Moto X, Moto G, and Moto E. They are priced at $300, $150, and $100. The ROI happens quicker with the cheaper phones. The Moto X is the only one that can use Sprint’s 4G service with data. I wanted that option if I ever decided to go to a 4G plan with them.
*Note: I chose the $10 plan for myself and the 3G plan for my wife; if we are unhappy with it we could always change the plan with no penalty.
The costs are $5 per month WiFi only, $10 a month Cell – Voice, Text, & WiFi, $25 a month Cell – Voice, Cell 3G Data, Text & WiFi, or $40 a month Cell – Voice, Cell 4G Data, Text & WiFi. *(These are the current prices without taxes and I suspect they are subject to change.)
The costs savings I have per month is put into a savings account which will be spent on investing when the account is big enough to invest in something better than a savings account.
*As a disclosure I did only switch over one of our phones first to try out the Republic Wireless Coverage before dumping the Verizon service totally. (We were grandfathered into their Unlimited Data plan and did not want to lose that if Republic didn’t work out.)