My son earns a weekly allowance for doing a number of household chores. Last month, he finally saved enough to buy a smart phone, which he claims that half of his 6-grader classmates already have. With the father-son agreement that he is responsible for 100% of his cell phone expenses, we allowed him to buy a smart phone. Now the next question is: can we find him a cell phone plan that he can afford?
An unlimited plan from a major carrier like AT&T or Verizon Wireless is out of the question -- the monthly charge will take the poor kid's entire monthly income away, and more. My wife and I are currently on prepaid monthly plans. Her unlimited plan from StraightTalk costs $45 a month. I, normally using less than 100 minutes voice, 10-20 texts and less than 200MB data, keep an AT&T GoPhone plan at about $35 a month. Both options are still too expensive in the eyes of our son.
So we embarked on a journey to find a plan for a cheapskate. "Mobile virtual network operators," or MVNOs, seems to be the way to go. They are wireless service providers who doesn't run the infrastructure but instead buy bulk block of voice, text and data at wholesale rates from AT&T and alike and resell to individuals. Back in 2004, I used Virgin Mobile, also an MVNO, at less than $7 per month (of course, no data back then).
We followed the complete MVNO list from Wikipedia to compare plans one by one. Many of such MVNOs offer pay-as-you-go plans that charges individually for voice, text and data, with a monthly or quarterly minimum. The most economical plan we found: H2OWireless. It charges 5 cents a minute for voice, 5 cents a message for text, and 10 cents an MB for data. What's even better is for a light user, one only has to charge $10 per quarter to keep the services alive, and unused money can be rolled over to the next quarter as long as one recharges every 90 days. It didn't get much cheaper than that. Also, according to Wikipedia, AT&T is the underlying provider for H2OWireless, so you get AT&T coverage at much lower price points.
Buying a SIM card from H2OWireless directly costs $9.99 (or $14.99 for the nano-SIM version), but many sellers at Amazon offers H2OWireless SIM cards at $0.01 or $0.02 with free shipping (search "H2OWireless SIM").
So, we ended up signing up our son for the H2OWireless plan. Guess how much he spends on cell phone in the last two weeks? 50 cents. And we are pleasantly surprised to find out that our son, incentivized to save a few bucks, didn't hook himself to Twitter and alike. Instead, he figured out how to use offline reading and was boasting to us the latest CNN news articles he read on the school bus.
Now I'm considering switching to H2OWireless myself. Based on my usage pattern, I will likely lower my monthly cell phone bill by $20 or so. It's more than enough to cover our Netflix and Amazon Prime bills.
How much does your cell phone cost you?