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Using an MVNO can save you on your cell phone bill
Posted on 12-22-2013 20:39:21 UTC | Updated on 12-26-2013 03:56:06 UTC
Section: /hardware/cellphone/ | Permanent Link

What is an MVNO?

A mobile virtual network operator (MVNO), is a company that buys access to a primary network operators network at a bulk rate and then resells said service to customers. They use their own customer support, marketing, billing systems, etc in place of the primary carriers. The bulk network access they purchase from the mobile network operator (Verizon, Sprint, ATT, etc) uses the exact same cell towers as the primary carrier. Many MVNO's get the same cell service and access to network improvements at or at very nearly the same time as the network provider's own retail customers. This means the primary differences between the MVNO's and the primary network operators are the type of plans that they offer.

Tiered providers

The larger mobile carriers in the US have always required you pick a plan when you signed up for their phone service. The problem with this model for consumers (not the carriers) is that you are likely paying for more service than what you really need or use. The cable companies work with the same model. Even if you pick the lowest priced plan it is still way more than what you want/need. But you pay for it anyways because it is the cheapest plan offered. Then at the end of the month you see that you used about 33% of the voice/text/data of the lowest plan the carrier offered. How frustrating is that? Well, that is all beginning to change.

This year MVNO's like Ting.com and Zact.com decided that plans are ridiculous and unfair to consumers. They have started a new trend that deals with "tiers" of usage. Every tier gives you a little more text/data/voice. As you use text/data/voice you automatically fall to the next tier. The great thing about tiers is they start at zero. If you don't use the service you don't have to pay for it. If you don't text then you don't pay for texts. If you use just a little bit of the service then you only pay for the smaller tier you fall into. If you need more you just keep moving up the tiers little by little.

Why are tiered providers the better choice for low to medium data/text/voice users?

You are charged based what you use. The larger carriers are not providing any plans that are of good value to the low to medium usage consumer. Can you blame them? They are there to make money for their stock holders and not do what is best for the consumer. Enough people are paying for these plans so that gives them no reason to change. In fact it's getting worse. As most have noticed the data plans have been driving the new breed of carrier plans. They practically give away voice and text now, but if you have a Smartphone your plans start with a $40/month fee just to have the phone and then it goes up from there.

What about heavy data/text/voice users?

Very heavy users are likely to not benefit from MVNO tiers or possibly MVNO's at all. Usually there is a comparison chart on the tiered carriers websites that help you decide if it makes sense. If you are a heavy user then MVNO Republic wireless ($19 unlimited everything, primarily through integrated VoIP) might be a good choice. Also, the Virgin Mobile ($35 for 300 mins, and unlimited data and text) or T mobile prepaid ($30 for 100 mins, and unlimited data and text.) might be good for you. The thing is even though these prices seem cheap the tiered providers can be cheaper, because some of the mentioned plans are per phone. No sharing. With a tiered provider they allow you to share the tiers with as many phones as you want. Adding a phone to a tiered plan is cheap. Like $5-$6 cheap. If you have others you want to put on your plan and they are low usage people as well (Grandparents?) you can really start to see the savings.

Why MVNO's offerings tend to be better than the primary carriers

Look out for the following with different MVNO's

Some of these are not true of all MVNO's, but it is a list of things to look for when you are shopping around.

List of MVNO carriers

Good breakdown of MVNO plans. It is updated often so don't let the date in the url fool you. There is also a good Wikipedia page with a list of US MVNO's.

Which MVNO did I choose?

I selected Ting as my MVNO. It offered me everything I wanted in an provider, but one of the biggest is they allow you to bring compatible phones to their network. They also allow some phone models outside of their network to be used. For example Google's Nexus 5. The unlocked phone that works with GSM and CDMA networks. To see how easy it is to setup the amazing Nexus 5 on Ting please vist our friends at Calomel.org. I also required a provider that used a tier system and not a traditional plan system. There are not many around that do this yet. Ting has a bunch of great features that make it a good MVNO choice.

Best features about Ting

Issues with Ting

If you do go with Ting please use my referral code and get $25 off your signup. I will also get $25, but it would be a nice thank you in help running my website.

So do I go with traditional carrier or an MVNO?

To answer this you really have to get a good handle on your normal monthly usage of voice/text/data. Add them up and average them out over the last 6 months to a year. Go to some different MVNO websites and check out their plans. Here are some questions you are going to need to ask yourself when deciding.

Workarounds for some of the MVNO shortcomings/issues

The larger primary carriers are starting to realize that people are not using voice as much anymore. Text and data are being used as a supplement for these. Texts are a high margin service, but were never charged as much as voice in the past. The carriers did not like that people started using texts instead of voice so they cranked up the price of texts. With the advent of all the tablets and smartphones data is where everything is heading, and the carriers are starting to build their new pricing models around it. Now voice and texts are not what people want as much, but data. So they have started giving out unlimited voice and text, but linking this to expensive data plans with high device buy in prices.

Many of the MVNO's are not taking to this model and are just doing the all services based on rates. But what this means is the more you use the service (voice/text/data) the more you end up paying. So it follows that you are going to do whatever you can to subsidize the usage of these services. If you leverage your use of WiFi wisely you can save big time.

Lets face it, many of us are around WiFi much of our day. If you have an internet connection where ever you are (home,work,coffee shop,etc) you can get a lot of these different services the MVNO offers for free if you just use WiFi as your data connection. Mainly this involves using 3rd party services to supplement things like voice and texts. By doing this you can cut down your usage of these services dramatically when you use WiFi connections.

Using Google Voice will allow you to text (SMS) people using your new Google phone number and it just uses your data connection on your phone or through WiFi. The same goes for voice calls. You can turn off SMS messages all together and save money there. It only uses a very small amount of data to send the Google Voice SMS message. It can not do MMS messages at this time but you can use Hangouts for that.

If you get good with using Google Voice, you will see big savings managing your voice/data plans together (let's say you turn off SMS and use GV for it) and actually gain the features GV has to offer in the process.

Final words

After making the switch to the MVNO provider Ting I have 20 days left before my next billing cycle and my current bill is $12. I'm using my smartphone in the exact manner I had before, so I have given up nothing. I have just changed the way I do things like making calls using GV VoIP and texting people through my GV number instead of my real phone number.

Just remember that switching to an MVNO might not be for you and your usage pattern. It is just something you should consider looking into if your looking save big money on your monthly mobile bills. Make sure you do all of your calculations carefully for how much an MVNO will cost you based on your past and predicted future usage patterns. Then consider all of what I mentioned above to make an informed choice. Good luck!

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