One of the many things that I've learned starting my new business, Lower Tech Bills - www.lowertechbills.com - is that cell phone plans are very daunting and difficult to understand. What’s worse, some plans change so often that the TV commercial you saw an hour ago may already be out-of-date. I'm a pretty regular visitor to cell phone brick-and-mortar stores and believe me, the people who work there generally have no clue as to what those changes will be or when they will be made.
But that's just the tip of the iceberg. Not to mix disaster metaphors, but the marketing tsunami that these companies have unleashed is enough to confuse even the most tech-savvy of us. So, let's break down the cellular world. In order to do that, you need to know the difference between a Mobile Network Operator (MNO) and a Mobile Virtual Network Operator (MNVO). It's very important to understand the distinctions between these two cellular acronyms. While both offer talk, text and data services, there are big differences between the way they operate.
An MNO is a company that owns the hardware (cellular towers and transmitters) on which you receive your services. They are known as the “Big Three” although that is somewhat of a misnomer. Since T-Mobile purchased Sprint in 2020, these three companies who do business across the United States are AT&T, T-Mobile and Verizon. There are a couple of other providers who I should mention here. They are U.S. Cellular (the same company that used to have the naming rights to where the White Sox play) and DISH Network. U.S. Cellular still does business in parts of Illinois and Wisconsin but pulled out of Chicagoland in 2013. Thus, U.S. Cellular Field begot Guaranteed Rate Field. DISH Network is beginning to build-out its own 5G network, Project Genesis, which is currently available in over 120 cities across the country. However, in Illinois, unless you live in Champaign or Springfield, Genesis has yet to see the light. For now, those of us living in Chicago have three MNO choices…AT&T, T-Mobile and Verizon.
MNOs have brick-and-mortar locations with real humans who offer their assistance along your cellular travels. Their people will help you set up your new phone, smart watch or other device and to many, that's very important. MNO locations offer the option to lease or purchase the newest phones as well as other accessories. MNOs also generally offer what are called "unlimited plans". Meaning most of their plans include 5G service with unlimited data and are "postpaid". That is, you establish credit and then you get billed each month. You may find services from MNOs to be a bit more expensive but then again, you may not, depending on current deals and perks offered such as free upgrades or phone discounts.
MVNOs are just what the second letter stands-for - virtual. They do not own any cellular towers. They lease their infrastructure from MNOs. That's right. If you choose a plan from one of the well over 50 MVNOs out there, you are actually using the cellular framework from AT&T, T-Mobile and/or Verizon. What's even crazier is that some MVNOs are owned lock, stock and barrel by an MNO. For example, Verizon has bet big on MVNOs. They already owned Visible when they bought TracFone for over six billion dollars in 2022. TracFone itself owned several MVNOs at the time like Walmart Family, Straight Talk and Simple. The other guys are in on it too. Metro by T-Mobile is owned by (of course) T-Mobile and AT&T Prepaid is owned by (you guessed it) AT&T. As the baseball vendors say, "You can't tell the players without a scorecard."
So how do these MVNOs work? They offer "prepaid" plans. No credit check needed. You put down a credit or debit card and it gets charged each month for a pre-set amount of services. Some MVNOs like Cricket, Metro by T-Mobile and Boost have brick-and-mortar locations, but most do not. Those MVNOs can be purchased through big box retailers such as Target or Walmart or online. Even stores like CVS and Walgreen's are in on the MVNO game. However, in many of those cases, help may come from an employee who could also be restocking toilet paper. Which means most customer service will be done on the phone or online. Lost yet? Well then don't go to Best Buy because they offer both MNO and MVNO options.
So, which of these acronyms is right for you? Well of course it depends. MVNO plans tend to be less expensive than plans offered by their MNO counterparts. While MNOs always offer unlimited talk, text, data and 5G speed plans, MVNOs may or may not, depending on the plan. However, even so-called "unlimited" data plans may have their limitations. But those are not necessarily the metrics which you should use when comparing price and value. It really depends on how much data you use per month, your need for speed, the services that you require and the devices that you use.
The cheaper MVNO plans tend to cap streaming data or charge more if you go over your monthly allotment. Their so-call unlimited plans may "deprioritize" or "throttle" the speed of your data if network traffic gets heavy (I'll explain deprioritization and throttling in another blog post, but it means slower results). That's because MNOs always get access to the 5G "express lanes" and uncapped data. Some MVNO providers offer rollover for unused data while some of the more expensive plans offer true unlimited data. Many MVNO plans start as low as $15 a month per line with some costing even less. However, those prices contain very limited amounts of talk time and data per month and often don't include taxes and fees. Understand that with cheaper plans, when you use your monthly allotted minutes or data, you will either be charged for additional minutes or data used or your speed will slow down. Confused yet? I know that I lost some brain cells just by writing this paragraph.
As I write this there is an all-out price war going on. Especially in the MVNO world because their value proposition is based almost entirely on price. On the other hand, MNOs will often advertise things such as coverage area, higher speeds, perks and customer service. Having said that, let's take a look at three examples of some of the MVNO advertised "deals" that are being offered since they are almost always based on price. But, as they used to say in front of the Roman Colosseum as scalpers were selling tickets to the chariot races, "Caveat Emptor."
Cricket’s current $30 monthly plan includes 5 gigabytes of data per month. That's just enough to check e-mail and download some applications. And if you look at the small print, it says, "Speeds will be reduced to 128Kbps max if you exceed your plan's monthly data allowance. Actual speed varies by device and location." Their plans also stream at 480P which is not high definition. The good news is that this $30 rate includes taxes and fees, but you do need to sign-up for autopay or it's $5 more per month. While it's nice that they have stores, they will charge $25 if you need their help with activating your phone as opposed to no-charge if you do it online.
Consumer Cellular, pitched by Ted Danson and geared to Baby Boomers, is currently "Cheering" a $55 per month unlimited plan for two lines. That sounds pretty good on paper at $27.50 per line. But, oh that fine print again. Look carefully and you'll see that in order to get this "deal" you have to be an AARP member, enroll in their autopay and E-Billing plans, it doesn't include state or federal taxes and you can only get it by calling them. It's not available in stores where Consumer Cellular is sold like Target or Walmart, nor can you sign-up for it online. Finally, high-speed data will slow after 50GB per month. So Ted, that might not exactly be the cellular "Good Place".
Mint Mobile, pitched by Ryan Reynolds and aimed at younger people, always seems to have some kind of deal going. You'll currently see Ryan hawking a $15 unlimited monthly plan. But the devil is in the details and when you hit the "View Details" button, sure enough, the "Deadpool" fills-up with fine print. This is a three-month minimum package, so you're in for at least $45. After that, the rate goes up to $25 a month. Plus, those pesky state and federal taxes aren't included. It's still not too bad until you see that you only get 4GB of high-speed data per month. If you use more, you'll keep moving-up the data tier ladder until you hit their "unlimited" plan. That one will cost you $30 a month. But as above, the rate is only good for three months. After that, it goes to $40 per month. But wait, there's even more fine print. It states, "Unlimited plan customers using >35GB/month will experience lower speeds. Videos stream at 480p. Capable device required. Coverage not available in all areas." So yeah, there's all that.
Yes, MVNOs generally offer lower rates, with no contracts or credit checks. While that might be fine for some people, MVNOs are not for everyone. The cheapest of their plans contain barely enough data to check e-mail on a regular basis and you'll never be stopped by the cellular police for speeding. On the other hand, there are valid reasons for some people to use them.
While data amount, speed, price and the other things that MVNOs offer are important, they may not be your only issues. For example, most operate only virtually (remember that "V"). Customer service may or may not (probably not) be as good as those companies that have a brick-and-mortar store. If you need someone to hold your hand through the setup process, you probably should visit a provider with a store. In addition, the newest phones often go to the MNO stores first if that's important to you. Some MVNOs have a limited selection of devices and if you're looking for a smart watch or “hot spot” you may or may not find it through an MVNO.
I recently tried an MVNO and while I had a good experience, I needed to do some research before I headed down that road. First, I had to make sure that I had an "unlocked" phone which was compatible with that MVNOs wireless carrier. That answer took a trip to both the internet and to a mobile phone store. Then, I had to wait a few days for a new SIM card to be shipped to my home (there are ways to download an E-SIM card, but that opens-up a whole new can of worms). I then crossed my fingers and toes as I installed it and - it worked! Thankfully, I was able to complete the installation without having to contact customer service, but you know the pitfalls of that. No joke - The last time I contacted a certain cable-TV company, I literally heard a rooster crowing in the background. Again, my overall MVNO experience was good, but if you are not necessarily a tech person or have access to a Millennial, you may want to think twice about going the MVNO route.
So, before you decide whether to travel the MNO or MVNO highway, think about their different approaches and ask yourself these questions. What can I (or someone who lives in my basement) do technically? What is important to me such as in-store customer service or getting a new phone? What do I need in terms of data and speed? On that note, try to determine how much data that you use each month through both your cell phone and your Internet providers. There are tricks that will allow you to get away with having unlimited data through one service and more limited data with the other. By the way, most people don't have a clue as to their data use each month. I know I didn't until I embarked on this journey.
It’s a confusing maze and it’s designed that way. That's why most people just pay their cell phone bill month-after-month. That's too bad because there are some real savings to be had. Lower Tech Bills is here to help guide you and to help capture those savings. I'll look at your bills for no charge and give you feedback. You may end up saving money and get a new phone or two out of the deal.
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