For the past two and a half years, I've been rocking my iPhone 4. It's held-up well over the years. My previous phone, an iPhone 3G, was pretty darn sluggish by the end of its two year tenure and I eagerly awaited the point where I was eligible for a phone-upgrade so that I could upgrade to the (at that time) brand-new iPhone 4. I just always assumed that was the “way it worked”: sign-up for a new two-year contract, get a subsidized price on a nice shiny-new piece of phone-hardware, and don't really think twice about the recurring $80+/month phone-bill.
But I didn't realize there were other alternatives…
Mobile Network Virtual Operators (MVNOs)
While reading though the back-archives of one of my new favorite finance blogs, I came across an interesting article, “Our New $10.00 Per Month iPhone Plans”, talking about switching to a monthly pre-paid plan and paying only $10/month for an iPhone cellular plan. I had heard mention of some of these “pre-paid” cellular vendors before but had never really looked into them much or really understand what they were:
Many of these new options are called Mobile Network Virtual Operators (MNVOs), and they are in fact just re-selling access to the bigger carriers’ networks. So you get the same reception, coverage, and reliability as you had before.
I had never realized! Same cellular network/service, you're just paying a different middle-man. And there's quite a long list of these MVNO's, lots of options for each of the major US mobile operators: AT&T, Sprint, Verizon, and T-Mobile. Reading the comments in that article was where a lot of the gold was; there's lots of great information in there. A lot of these MVNO's have been around for quite a while and are pretty well-established.
So, since my iPhone 4 hardware was still giving my reasonable performance, I decided to skip the expected hardware-upgrade and stick with my current handset and try to milk it for all its worth.
Choosing a Company & Plan
After doing some more reading, I ending-up choosing Airvoice Wireless because they seem to be one of the favorite (and well-established) AT&T-based MVNO's and they have lots of different plan options.
Since my phone is already setup to run on AT&T's GSM network, you wouldn't even need a carrier-unlock to be able to jump to one of the AT&T MVNO's because it's still using the same carrier network behind-the-scenes. Though, truth be told, since I was out of my 2-year contract with AT&T, I did make use of AT&T's free carrier-unlock before ditching my AT&T plan so that I could use my handset when traveling internationally should the opportunity arise…
I considered going the ultra-frugal $10/month Talk & Text plan but that seemed a bit too restrictive. I'm coming from my AT&T plan which had 450 anytime minutes (though I only used on average ~100 minutes per month and had a huge rollover pool) and my grandfathered-in Unlimited data plan from my original iPhone 3G based plan. I usually averaged around 200MB-300MB of data per month, so I wasn't really reaping much from my Unlimited data-plan. The ultra-frugal $10/month plan would mean I'd really need to scrutinize my cellular data usage ($0.33/MB adds up quick!), as in turning-off cellular data most of the time and only turning it on when I absolutely needed. That was just a bit too extreme for me — too much penny-pinching.
So, to make my transition from AT&T to Airvoice Wireless as painless as possible, I opted for their $40/month Unlimited Plan with Data which has unlimited talk & text (neither of which I use much of) and 500MB of data per month.
Making the Switch
Here's a quick summary of the setup/transition process…
- Bought a Airvoice Wireless SIM card through their website. It arrived in a few business days.
- Activate the SIM card on Airvoice Wireless's website, picked which plan I wanted to use, got a phone number assigned to my new account (or you could have ported your existing cell number to Airvoice), and put some money into my account.
- Using some print-out templates I found online (and putting on my arts-and-crafts hat), I trimmed the normal-sized SIM card to the micro-SIM size to fit my iPhone SIM card tray.
- Drop the new SIM card into my iPhone. No need to turn-off or power-cycle.
It connected to the Airvoice Wireless network immediately. You'll notice
AIRVOICE WIRELESSvendor banner on the upper-left of your iPhone screen.
- To get cellular data working, you need to install the correct Access Point Name (APN) settings for Airvoice Wireless. Just connect to Wi-Fi, fire-up Mobile Safari on your iPhone, navigate to http://www.unlockit.co.nz/, select “Airvoice”, and click Install. It will prompt you to install a new Profile with the APN settings for Airvoice. With the correct APN settings in-place, I turned off Wi-Fi and the 3G data worked as normal.
It's only been a few weeks so far, but all-in-all the transition has been extremely painless.
- I cut my phone-bill in half: $85/month -> $40/month. Yowza!
- Same cellular service, since I'm still effectively using AT&T's network.
- Not locked into another contract. I can switch to another vendor whenever I want, if for some reason I don't like Airvoice. That kind of agility is refreshing.
- No integrated iPhone visual voicemail, at least that I know of. (Though this doesn't bother me much because I ported my number to Google Voice as part of this transition, but that's a story for another time…)
- Need to remember to login every 30 days to renew your service. This could admittedly be a bit of a drag, but it's easy to add a monthly reminder, and a few extra minutes worth of work per month seems well worth the savings of $40/month x 12 months = ~$500/year.
- No fancy website. AT&T had a pretty decent website with all kinds of historical usage statistics. I get none of that now. Airvoice is a smaller operation and I'm okay with that. If I want to get usage stats, I just need to do it myself using the usage-counters on my iPhone.
Even if some months I do happen to go over my 500MB/month cap, I would simply drop another $40 in my account early and that would restart the 30 day expiration over again. As I understand it, a given prepayment expires either: after 30 days or after you've used up your quota, whichever comes first.
If I find the $40/month plan is either too limiting or I'm consistently not using everything I'm paying for, I can always easily switch to a different plan/tier. Based on the Airvoice Wireless terms of service, it sounds like they won't refund you a partial-month at all; you need to make a cut at the end of your 30 day cycle (to make the most of your money) and you need to call customer-service to switch your account over to the new plan. I (obviously) haven't tried this yet but it sounds pretty painless.
And by saving $500/year on my cell phone bill, that's basically the price of a brand-new (unlocked) flagship phone. So, I could still upgrade my hardware and still come-out ahead because I'm not tied into an expensive contract with one of the big cellular companies.
It will be interesting to see how this plays-out over the next few months, to see what happens to my service at the end of a 30-day cycle (e.g. how apparent will it be that my service has cut off and that I need to pump more money into my account?), to see how often I use up my 500MB quota before the 30 days are up, etc. I'm just darn excited to have interesting new options/alternatives.