If you don't know what net neutrality is, check out my net neutrality post. Verizon has made news this week by announcing that their Go90 video service will not count towards their user's data. This isn't the first time carriers have given certain services a pardon, with T-Mobile boasting free unlimited music streaming to certain services. So what's the problem? It's good for the user, so who cares? Who doesn't want unlimited music streaming or video?
Well, the problem here lies in the very problem with violating net neutrality. It's unfair for other businesses that aren't given this privilege. Imagine that you want to create a new company that streams music to compete with Spotify, but something Spotify has that you won't is that streaming Spotify doesn't affect people's' data. This means you're never going to become as big as Spotify unless you're added to this special "VIP" data list. Not only is this bad for that company, it's bad for the user because it curbs competition. Verizon's choice to have their Go90 app free of data charges is even worse than T-Mobile, because they're the ones directly making a profit and stealing users from the likes of other video streaming platforms. While I don't like T-Mobile's choice to have certain music streaming services not incur data charges, I think it's at least more morally acceptable than what Verizon has just done. At least T-Mobile continues to add various music websites to encourage competition. Verizon, on the other hand, has done this purely for selfish gain.
Why is it that Americans are so easily tricked into two year contracts and upgrade plans? When you look around to buy a smartphone, it gets confusing. Two year contract? Upgrade plan? What about data, how much of that do you need? I'm here to tell you that you've been phone shopping all wrong.
Most Americans would go to a major wireless provider like AT&T, Verizon, Sprint, T-Mobile, and US Cellular to purchase their smartphone. This is sort of weird, isn't it? I mean, you wouldn't buy your car from the company that sells you gas. When you buy a phone from your carrier instead of the manufacturer, most of the time you're going to be taking out a loan from the carrier. That $200 phone isn't actually $200, it's closer to $700, but the carriers make you pay the rest back and more over the course of your contract. Well if you don't buy your phone from your carrier, where do you get it? And where do you get the plan for it?
Try to look for the words "unlocked" and "off-contract" when searching for the phone you want. You can usually either find them on the manufacturer's website, Best Buy, or other online retailers. Once you find that, you're ready to start looking for a plan. While many top carriers sell cheaper plans without the need for a contract, MVNOs (mobile virtual network operators) can sell plans much cheaper than the big guys. Now, MVNO may sound like a foreign word, but I'm sure you've heard of them. Companies like Straight Talk, Net10, Boost Mobile, Virgin Mobile, and many more are all MVNOs. They use the major carriers' networks such as AT&T, Sprint, and T-Mobile, letting you have the same quality for a fraction of the price. How is this possible? They pay the major carriers to use their cell towers and resell their wireless service for cheaper. This means you can get individual 5GB data plans for less than $50 per month.
As an example I'm going to use Net10 and an unlocked GS6, and compare it with the price of buying the same phone from AT&T (with a 2-year contract) over a two year period. Both plans include unlimited talk and text.
Net10 5GB service = $45/mo
Phone and service over two years = $1729.99 2-year contract Galaxy S6 = $129.99 AT&T 5GB service = $90/mo
Phone and service over two years = $2289.99
There are many other factors to consider, such as upgrade plans, other options from carriers, and how long you're going to use your phone. Net10 does not lock you in any contract, and if you want to cancel, you can. What's better, you own your phone. If you buy a phone from AT&T, they technically own it just like the bank owns a house you have a loan on. Buying no-contract from AT&T isn't a good idea either. In fact, it actually comes out $95 more than the 2-year contract version. MVNOs and unlocked phones are almost always cheaper in the long run. So stop thinking that "free" or $200 phone is actually that price, pay the money for it up front, and stop losing more money than you need to every month!
