Smart Talk
Time for a new cell phone, service plan...or both? Use this guide to pick the perfect ones for your needs and budget.Laurianne McLaughlin
Freelance writer Laurianne McLaughlin uses 599 voice minutes a month.
Photograph by Robert Cardin
Berger, a New York University mathematics professor working at NASA's Ames Research Center in Mountain View, California, says that the worst part was the company's lack of concern. "I called [T-Mobile] repeatedly," she says. On the first call, a representative promised to put in a request to look into the coverage issue. When she called back, a rep couldn't confirm whether anything had been done. She called customer service twice more and asked for some accommodation. "T-Mobile's response?" she reports: "'Well, our [voice coverage] map says it does work [in your area].'"
T-Mobile spokesperson Richard Brudvik-Lindner confirmed that Berger lives in "a pocket with substandard coverage." After we contacted T-Mobile, the company offered a refund on the phones and waived the penalty for canceling her contract. But T-Mobile says that to test her phone adequately, Berger should have tried it out in her new house during the trial period.
Berger's experience illustrates two of the biggest frustrations of owning a cell phone: spotty coverage and mediocre customer service. To help you shop wisely, save money, and avoid getting burned, we researched voice and data plans from six nationwide wireless service providers: AT&T Wireless, Cingular Wireless, Nextel, Sprint PCS, T-Mobile, and Verizon Wireless. (AT&T and Cingular will soon merge, but their representatives asked us to consider them separately for purposes of this story.)
The good news: You'll find deals on many national plans, and with some care, you can avoid surprises on your bill. The bad news: Once you're locked in to a contract, don't expect tender loving care from the customer service department of any carrier. As for choosing among hardware options, we examined three categories of cell phones--basic, camera-enabled, and PDA hybrid--to help you find one that suits your budget and needs. Armed with our tips, you'll be able to dodge some of the most common cell phone frustrations.
Calling Plans
Researching cell phone plans is about as much fun as pouring through income tax filings. For starters, it's not easy to figure out which company provides the best or worst service. Scouring the Web, we came across a report the Consumers Union group Escape Cell Hell had posted. It said that out of a total of more than 20,000 consumer complaints filed with the Federal Communications Commission against the six nationwide carriers in 2003, AT&T Wireless drew the highest percentage of complaints; Verizon drew the fewest, followed by Nextel, Cingular, T-Mobile, and Sprint. The leading gripes for all carriers related to billing, number portability, and service quality. (Click here for more details on the report.) In response, AT&T says that it has since expanded its network. "This filled most of the coverage holes that customers may have been experiencing," says spokesperson Ritch Blasi.
To find out about dead spots, ask friends and neighbors, and read the reports posted by cell phone users at DeadCellZones.com; the site logs users' complaints about areas that have poor or no coverage. Don't rely on the carrier's coverage map. Just because your area is shaded doesn't mean you'll get good coverage.
Take advantage of the vendor's trial period to test both its service and its phones. The six major carriers offer 14- to 30-day trials, during which you can cancel the service if you're dissatisfied. Test the phone in the places where you spend most of your time--for example, in your office, on your commute route, and in all the rooms of your house. During your trial period, you'll pay for only the voice minutes and data transmission amounts you use; in some instances you'll also pay an activation fee, usually $35 to $50. If you don't cancel within the trial period, you'll be committed to a one- or two-year contract, whichever you select. What if you like the coverage but not the phone? Immediately go back to the store and request a new phone. Set a reminder on your calendar to cancel the service two days before the trial ends.
A caveat: Most trials don't last long enough for people to receive a monthly bill--a sore spot for consumers. According to a recent Better Business Bureau study, "the major area of consumer complaints involved either various forms of billing problems or communications problems that didn't surface until consumers received their first bill," says Charles Underhill, senior vice president for the Council of BBBs. This situation led California's Public Utilities Commission to adopt new regulations for wireless carriers. One notable provision allows consumers to back out of contracts after 30 days of use without incurring any penalty--in effect, extending a two-week trial period. Barring further changes, the state rule takes effect in late November.
Cellular Networks
Your network choice can shape your hardware choice, so understanding the different network standards will help. You get an alphabet soup of options: CDMA, GSM, iDEN, and TDMA. Sprint and Verizon use CDMA (Code-Division Multiple Access). AT&T, Cingular, and T-Mobile support GSM (Global System for Mobile Communication). Nextel is the only carrier on iDEN (integrated Digital Enhanced Network). AT&T continues to use TDMA (Time-Division Multiple Access), a now-aging technology, in some areas. You'll save a few bucks on a TDMA phone, but your choices will be limited.
To get the most innovative phones, choose either CDMA or GSM. Some GSM phones allow you to roam in other countries. Ask the carrier about countries you expect to visit, because network standards vary. Newer GSM phones feature an additional layer--GPRS (General Packet Radio Service) or EDGE (Enhanced Data for Global Evolution)--for faster data transmission on tasks such as text messaging. However, GSM phones don't support analog signals. If you travel to rural areas, you will need a CDMA- or TDMA-based phone because it can transmit analog signals. Check the handset specs for analog. If you'd like to get details on cellular standards and to learn about other wireless lingo, consult the glossary that's maintained at www.phonescoop.com.
Price Comparison: What You'll Pay for a National Plan
Deciphering Plans
Now you're ready to tackle the heart of the buying decision: estimating your cell phone budget and making sense of the plans. Your options include national, regional, family, and prepaid plans. With a regional plan, you'll get more monthly minutes than you will with a similarly priced national plan. For example, the same $50 buys you 600 "anytime" minutes per month with AT&T's GSM America National plan, or 800 monthly minutes with its GSM America Local plan.
If you seldom leave your area, pick a regional plan; it offers more minutes for the money. If you travel even a few times a year, go with a national plan because roaming charges with local plans add up quickly at 49 to 79 cents a minute, depending on the carrier and the plan.
As for the monthly minutes, how big a bucket do you need? Start scanning the plans, and you'll see skimpy offers starting at 45 minutes and huge plans that offer thousands of minutes. U.S. cell phone users now average 615 minutes a month, says Roger Entner, director of wireless at research firm Yankee Group. Many users will stay under the 600-minute limit, but "signing up for a 600-minute plan is the safe play," Entner says. The cost of a 600-minute plan from one of the major carriers ranges between $40 and $60 monthly (see the chart).
After you sign up for the plan and have used it for a couple of weeks, check the number of minutes you've actually used and adjust your monthly allotment as necessary. Most carriers let you change this part of the plan during the first few weeks without extending your contract. If you go beyond the allotted minutes, each extra minute typically costs 40 to 45 cents.
Most companies do not allow you to roll over your unused minutes to the next month. But Cingular is an exception: The company transfers any unused minutes to the following cycle. The minutes expire after 12 months, however; and night, weekend, and in-network, mobile-to-mobile minutes don't roll over.
If your minutes vary from month to month, consider Sprint's Fair and Flexible plan. The amount you pay for this plan reflects the actual number of minutes you used that month, and the plan adjusts without penalties. For example, use between 0 and 300 minutes and pay $35; use between 301 and 325 minutes, and pay $38, and so forth. Sprint's Web site makes it easy to see what you'll have to pay for each increment of minutes.
If you call the same person or a group of people on the same network, save money by getting a plan with unlimited in-network calling and/or a family plan. For example, Verizon's America's Choice Family Share plan lets you call anyone on Verizon Wireless's network without limit for $40 or more a month (depending on your area) for the first phone and $20 for the second handset; you also get 500 extra minutes to call any number. Such deals are so cost-effective that you may stop using your landline to call friends and relatives. In fact, according to a Yankee Group report, cell phone users on average place 43 percent of their long-distance calls on a mobile phone.
If you prefer to be contract-free, or if you're a parent and want to keep your kids' cell phone usage in check, choose a prepaid service. Prepaid phones work like gift cards, providing a certain allotment of minutes. For example, T-Mobile's EasySpeak starter kit comes with a basic cell phone, a charger, and 60 voice minutes for $50. Minute refills come in $10 to $100 increments: $10 for 30 minutes; $25 for 100 minutes, and so on. You buy refills via the phone or at T-Mobile stores and chains such as 7-Eleven and Target. One catch with prepaid services: The minutes expire after 90 days (or after 30 days for the $10 or cheaper refills) unless you refill before expiration, in which case the minutes roll over. (Go to "Dialed In" for more on prepaid plans.)
In addition to browsing the carriers' sites, compare rates and phones at TeleBright or at MyRatePlan.com. At each site, you simply enter your location and choose the plan or phone features that you desire. The site returns a list of the options that are available in your area.
Number Portability
Number portability allows you to transfer your existing cell phone number to a new carrier. You need to keep your old service active until your new carrier transfers the number. These days, the switch should take a day to complete. Providers don't prorate bills, so cancel your service at the end of your billing cycle. If you make the switch at the carrier's store, bring your old cell phone bill. Be aware that some small, regional carriers don't offer number portability.
Warning: Though you'll probably be able to keep your old number, you may not be able to keep your old phone. Some cell phones have software locks, which prevent their being used with another carrier. The providers justify this practice by pointing out that they are subsidizing the cost of your cell phone. To find out whether your handset is locked, simply ask your carrier. Another caveat: If you move to a different city or state, you may not be able to keep the same cell phone number.
Contracts and Pitfalls
Deciding between one- and two-year contracts is a straightforward choice. The benefits of a two-year contract often include the waiving of the activation fee ($35 or more) and a reduction in the cost of the phone. If you prematurely end a contract, cancellation fees can cost you hundreds of dollars--for example, $175 with Verizon and $200 with T-Mobile.
Comprehending the details of a contract is a trickier task. To avoid surprises, read all the paperwork. If you don't understand the details of the plan, or if you get conflicting information from the carrier's site and the in-store sales reps, talk to a supervisor and get that person's name. Having a record of your conversations with customer service reps may help you in the long run--especially when a company doesn't deliver on its promises. Just ask Brian Gaudreault, a network security engineer for a data-reporting company in Milford, Connecticut.
Photograph by Amy Etra
Cingular spokesperson Ross Jacobs says "there was a miscommunication, or [Gaudreault] was given incorrect information. Unfortunately, his phone is incompatible with the cradle." To compensate him, Cingular offered to replace his current Nokia 3600 with a model that works with the FastForwarding cradle.
Another sore point for cell phone users: fees for directory assistance. For example, on Verizon's site, the America's Choice plan lists 411 Connect as an "included feature"--but that doesn't mean that the calls are free. Click the description, and you'll discover that Verizon charges $1.25 per call, plus airtime, for such assistance.
Taxes can be tricky, too. They vary depending on where you live, and the carriers don't break out these costs. Fortuitously, the nominal fees (amounting to a few dollars) are standard among carriers.
Customer Service: Can I Get Some Service, Please?
Photograph by Robert Ervin
He called Sprint again and learned that it charges a $5 transaction fee, leaving him $1 over his credit limit again. When he asked to speak to a supervisor, the rep said she needed "a valid reason" to transfer him, and hung up. "I called back and talked to a different rep, who was embarrassed and said, 'I can't believe this,'" says Halula. "He credited my account and [my phone was soon reactivated]."
Of all complaints filed with the U.S. Better Business Bureaus in 2003, cell phone companies accounted for 18,323 (an improvement over 2002's total of 21,534), in a group of more than a thousand industries. Only car dealers attracted more complaints. According to the BBB, consumers frequently cited difficulties with customer service or confusion over billing or plan details.
Will switching carriers improve the situation? Not likely, says Lewis Ward, IDC senior wireless analyst. He adds that creating "bigger and better call centers is the [right] move"--but don't hold your breath. Carriers probably won't spend money on call centers because research shows that service alone isn't enough to make people switch carriers. The BBB's Charles Underhill disagrees: "With number portability, consumers are less tied to one carrier, and the companies can no longer count on an exponential increase in the number of new customers," since so many people already own cell phones. Ultimately, being persistent will likely yield the best results.
The Dish on Data Plans
Data services in one regard are simpler than voice plans to shop for. In many areas, one carrier has better voice coverage than others, so most people will pick that service, no matter what. If you have two good options, you can comparison-shop for data plans. Either way, understand the costs before you start text-messaging and picture-sending your way into debt.
Current data services are handy for sending text messages, e-mail messages, and quick snapshots for business or pleasure. Downloaded applications such as games and ring tones are popular, too. But data services aren't cheap, and carriers package and price them differently.
With messaging, you'll get another little taste of alphabet soup: SMS (Short Messaging System), for text messaging; and MMS (Multimedia Messaging System), for transmitting photos and video and audio clips.
If you expect to send or receive lots of instant messages, pick a plan with unlimited IM. You don't want to pay 10 cents each time you transmit an emoticon. You can send and receive SMS messages between different networks. With MMS, you can transmit messages only to someone using the same carrier as you. By year's end, you should be able to transmit MMS messages between different networks, according to AT&T's Blasi.
Among the big carriers, Sprint's data plans provide good value for moderate and heavy users. The $15-a-month PCS Vision Pictures pack lets you send an unlimited number of pictures, and send or receive 100 text messages. You can exchange unlimited AOL and Yahoo instant messages and e-mail messages, and browse the Web without limit. Sprint throws in a monthly credit of up to $5 for use toward downloadable games, ringers, and screen savers. Sprint is the only major carrier with a broadcast TV service, too. For $10 a month, PCS Vision subscribers have unlimited access to MobiTV, a service that streams video of sports, entertainment, and news channels (such as MSNBC) to cell phones.
AT&T Wireless's data plan is one of the hardest to understand, making you slog through options that charge different rates for different types of data. Fees for data services are based on kilobytes--a confusing pricing structure that assumes you know that an e-mail message typically uses 5KB. AT&T's MMode plans cost $3 to $20 monthly. Outgoing text messages and IMs aren't included in MMode base rates, and they cost $5 for 100 messages; incoming messages are free.
Having free incoming text messages isn't always a good thing: Some carriers (including AT&T and Sprint) send text messages advertising other services. Look for opt-out instructions at the bottom of such messages if you don't want to receive them. AT&T also lets you opt out through its site, on the privacy policy page. (Click here for more information on data services.)
Up Next: Faster Networks
Faster networks promise to make Web browsing and e-mailing by phone more practical, at prices similar to today's. But not yet. Currently, AT&T's and Cingular's EDGE networks offer speeds of 80 to 130 kbps. By 2006, Cingular may use an even faster network called UMTS (Universal Mobile Telecommunications System) with data rates up to 384 kbps.
Verizon's current Broadband Access service, based on the EvDO (Evolution Data Only) network, can transfer data at 300 to 500 kbps. EvDO phones are expected later this year, says Verizon's Brenda Raney. Today, only customers with wireless cards--primarily in laptops--can use Broadband Access, and only in Washington, D.C., and San Diego. Expansion is expected starting this fall and into 2005.
Cell Phones
Once you're armed with information on cell phone plans, your other major decision is the phone itself. Today's models range from plain vanilla to ones that have everything but hot fudge on top. Decide on the category of phone that suits you--basic, camera, or PDA--and then cruise the wireless provider's Web site or local store.
Basic phones:Motorola i830 (left), Samsung X105.
Your cheapest option--a bare-bones handset such as Nokia's 3595 or Samsung's X105--is often free or very affordable at $150 or less with a two-year contract. But what features will you miss out on with a basic phone? For starters, some models have a gray-scale rather than color screen. And some of the most basic GSM phones lack GPRS, so you won't be able to browse Web pages, though you may be able to access text-only pages.
If you step up a level, you'll get a phone with a miniature operating system, such as JAVA or BREW, that allows you to download apps, games, and fancy ring tones. Middle- and top-tier models (for example, AT&T's Nokia 3100 and Nextel's Motorola i830) typically offer higher-resolution color screens, support newer standards (such as Bluetooth, GPRS, or EDGE), and have more storage for running business apps, travel aids (such as GPS), and personal information-management utilities.
Cool Camera Phones
Camera phones: Samsung SCH-a610 (left), Sony Ericsson T637 (center), and Nokia 6820.
Camera phones sport some of the most innovative designs among handsets, but you can expect to pay a premium for one. For example, Nokia's 6820 (offered by AT&T for $200 with a two-year contract) comes with a VGA camera and a flip-out keyboard that's useful for text-messaging junkies. Samsung's clamshell-style SCH-a610 (at press time, $70 with a two-year contract with Verizon) features a rotating camera lens and a swiveling LCD so you can view the screen with the cover either open or closed.
Other camera-enabled handsets, among them the clamshell-design Samsung A680 available from Sprint ($150 with a two-year contract), can capture still images and short video clips. For more picture-taking control, look for a model that has a tiny built-in flash, digital zoom (optical zoom isn't available yet), resolution adjustment, and a night mode. Because the user interface and menus vary from one phone to the next, test-drive the phone at a store or sign up for a trial period.
Sure, camera phones can be fun to use, but mediocre image quality is the norm for now. Most models come with a VGA (640-by-480-pixel) camera chip that typically yields grainy 3-by-5-inch or smaller prints. Camera phone technology is improving, however. As we went to press, Sprint launched the PM-8920 from Audiovox with a 1.3-megapixel camera and a small flash. Upcoming 1-megapixel and higher camera phones include the Nokia 7610 and the Kyocera Koi; these and other models should be out by year's end.
PDA Phones
PDA phones: PalmOne Treo 600 (left), Samsung SCH-i600.
PDA/phone hybrids, the priciest category of handsets, give you a full-featured phone with the best screens for Web browsing and messaging. PalmOne's Treo 600 (with a two-year contract, $500 from Cingular and $550 from AT&T or Sprint) lets you sync its phone book and calendar with those on your PC. And because PDA phones run on a powerful OS such as Palm or Microsoft's Windows Mobile, you have access to many office apps. Some PDA handsets, including the Sidekick from T-Mobile and the Treo, come with a small yet handy keyboard.
No matter which phone you buy, make sure it supports the bands (network frequency) you'll need: Some models are digital-only, for example. You'll need analog if you roam to rural areas.
Our final advice? We said it before, and we'll say it again: Test-drive phones and services before committing to a contract. Even if that means trying out several options and paying a little extra, it's the only way you'll know which mobile phone and wireless plan work best for you.
Chart: Cell Phones Compared
