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I’m notoriously bad at predicting the future (I once dismissed Bluetooth as a niche technology that would never serve any useful purpose), but I feel like we’ve reached a tipping point. No, I don’t mean that all future fundraising efforts will involve getting doused with a bucket of something, though that’s a pretty solid bet.
I’m talking about the two-year phone contract, which appears to be on the brink of collapse. There are two reasons for this.
First, smartphones have gotten so good, we can stop chasing the upgrade cycle. Ask anyone who bought an HTC One, iPhone 5, Samsung Galaxy S4, or similarly robust 2012/2013 phone if they’re feeling the need to upgrade. I’m guessing the answer will be no. Once you have a fast processor, great screen, and solid camera, what more do you really need?
Second, and this brings us to today’s topic of conversation, once your current phone is out of contract, you’re no longer beholden to your Big Four carrier. Depending on whether it’s a CDMA model (from Sprint or Verizon) or GSM (AT&T or T-Mobile), you can potentially make a move to a less-expensive, no-contract carrier offering more or less the same service.
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The same holds true if you’re in the market for a brand-new phone, because now you can buy an unlocked, carrier-agnostic model for a couple of hundred bucks — not $600 to $700 like in the days of old. (Sure, some higher-end, bleeding-edge phones will still set you back that much; no doubt the upcoming iPhone 6 will be one of them.) And these aren’t crummy little slowpokes, either; I’m talking about the Motorola Moto G ($179) and Moto X ($349), Google Nexus 5 ($349), and OnePlus One ($299), to name a few.
Once you have one of these unlocked phones (or you’ve unlocked your existing phone), now you can shop it around to any number of no-contract carriers (also known as MVNOs): Consumer Cellular, Cricket, Giv Mobile, H2O Wireless, Solavei, Straight Talk, Ting, and so on. Just look for any carrier that supports Bring Your Own Device (BYOD). That leaves out the likes of Republic Wireless and Virgin Mobile — affordable no-contract carriers, both, but they lock you into select phones that can’t be used on other networks.
I think the OnePlus One is a great example of where the smartphone industry is headed. For a mere $299 (or $349 if you go for the 64GB model, a no-brainer), you get a slim, powerful handset with a dazzling 5.5-inch (!) screen and nearly every bell and whistle you can imagine.
Once you buy the phone, you own it. Now you can take it to just about any GSM carrier and sign up for whatever service plan best fits your needs. (The One is also compatible with Verizon’s WCDMA network.) Want to skip a carrier altogether and rely on Skype for all your calls? Go ahead. In other words, you’re in the driver’s seat. If you try, say, Straight Talk for a couple months and decide you don’t like it, or you find a better deal elsewhere, just make a switch. No penalties, no early-termination fees.
So what’s the downside?
All this begs the question: What am I giving up? Do you really get the same service from a Cricket or Ting that you get from an AT&T or Sprint?
That’s the sticky wicket. The answer can vary widely depending on which carrier you choose, and to a lesser extent, which phone you bring to it. When I moved my iPhone 4S to Straight Talk, for example, it took some serious hoop-jumping to get MMS messaging to work properly — and visual voicemail was gone for good.
Republic Wireless and TextNow, two carriers that rely heavily on Wi-Fi for calls, messaging, and data, don’t currently support short-code messaging, which I consider a fairly major shortcoming. And some MVNOs have limitations when it comes to roaming, though this seems to be less of an issue now than it was a few years ago.
The other key question is whether you really stand to save that much switching to an MVNO now that the Big Four are engaged in a price war (all four have lowered their rates in 2014, some more than once). If a family of four can pay, say, $40 per month per device for AT&T service, where’s the incentive to go Straight Talk at $45 per month? (Answer: not everybody has a family of four.)
Have you tried a no-contract carrier?
Like a lot of tipping points, this one brings with it some confusion and uncertainty. I, for one, will never sign up for another two-year contract, even if it means paying a bigger chunk of change up front for the phone I want (cough, iPhone 6, cough). The math still works in favor of going the no-contract route, especially for those who keep their phones for at least two years. And I’m hooked on the flexibility of switching carriers whenever I want.
But over to you: Have you tried any no-contract carrier(s) yourself? If so, which one(s), and what was your experience? I know there are legions of Ting fans out there, and I must admit to loving Virgin Mobile’s $30-per-month plan for my iPhone 5S — even if Sprint’s coverage in my area is mediocre at best.
As our country “tips” away from the two-year contract, let’s share what we’ve learned about going contract-free — the good, the bad, and the unexpected.
Bonus deal: Calling all Katy Perry fans (it’s OK, you can admit it — I actually enjoy her stuff myself): For a limited time, Google Play is offering Katy Perry’s entire “Prism” album for free. Price elsewhere: $7.99 or more. The songs are provided in DRM-free MP3 format, so you can easily download them for use on other platforms and devices.
