Wednesday, October 06, 2010

Mobile Phone Rip-off

This post is mostly thanks to Debbie Littlejohn, the editor of WXP News. This makes me praise Europe, where my phone is unlocked, not tied into any particular company. I am free to change services whenever.

If you're a smartphone user with all the bells and whistles on your account, it can be downright scary when you take a look at how much you pay your cell phone company over the course of a year. Let's take a typical connected couple, with both people having phones on a Verizon family plan. If they don't talk much, the lowest priced voice plan they can get is for 700 minutes. That costs $100/month if you want text messaging, or $70/month for talk only. Data packages range from $10/month for 25 MB to $45/month (per phone) for the business data plan. Most will need at least the 30/month unlimited consumer plan, so now we're up to around $160/month. 

Let's say you have the Droid X phones and you want to be able to use your phones as wi-fi hotspots when you travel. That's $20/month more, per phone. What if you want GPS navigation? That's another $10/month, per phone. Now we're at $220/month. Tack on fees for Visual Voice Mail ($3/month) and VCAST video on demand ($10/month) and it's $246/month. Oh, and if you want insurance on those phones, add another $6- 8/month, for a total of around $260/month. That's over three thousand dollars per year - but wait! We haven't added in taxes and surcharges and all those other little special fees that can add 20-30% to your bill. Being optimistic and assuming only 20%, that brings your annual expenditure for cell phone service for two people to $3744, and that excludes the $400 you paid for those subsidized phones. 

Of course, not all of us need or want all of those services, and costs vary depending on provider. Sprint, for instance, has a $99/month (per phone) plan that includes unlimited "everything" (talk, text, web, email). But then they charge an extra $10/month if you have a 4G capable phone like the HTC EVO (whether or not you're in an area that has 4G service) and $30/month for wi-fi hotspot capability. With insurance, your monthly charges for two come to $284 excluding the taxes and fees - and those EVOs cost you $300 each. 

Okay, then what about an iPhone? Your family plan with 700 minutes costs $70/month (and you do get rollover). If you want to tether, the data plan is $45/month per phone, and unlimited texting is $30/month (for both phones on the family plan). AT&T Navigator is $10/month. In other words, the service prices are the same as Verizon's (coincidence?) and your iPhone 4 costs $200- 300 each, depending on whether it has 16GB or 32GB of storage (better spring for the 32, since there's no microSD slot). 
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