As we just discovered, the lifetime cost of smartphones is enough to make you question the meaning of life.
But why are prices so high and seemingly on the rise when the cost of data transfer should be declining? For starters, there is a lack of competition to keep prices down.
In fact, there are only four legitimate mobile national network operators left in the U.S.:
- Verizon (149 million subscribers)
- AT&T Mobility (138.8 million subscribers)
- T-Mobile (owned by the German Deutsche Telekom) (70.7 million subscribers)
- Sprint (54 million subscribers)
These four own a majority of the wireless spectrum from which almost all mobile/data plans in the U.S. run. There are a few other smaller network operators such as U.S. Cellular (with about 5 million subscribers) – but it’s probably only a matter of time before they are bought up by the big 4. Consolidation is the trend, because consolidation = lack of price competition and more wireless spectrum gained by the buyer.
Except, when it comes to MVNO’s.
What is an MVNO?
MVNO = mobile virtual network operators.
MVNO’s do not own wireless spectrum, like the big 4 do. They buy up wholesale network access from the big 4 at low rates. And then charge customers whatever they like.
Most MVNO’s know they can’t compete with the big 4 directly:
a. they don’t have their own network, so what is their selling point?
b. they don’t have huge ad budgets
So who do MVNO’s compete with? Each other. And what do they compete on? Price (almost all MVNO plans are prepaid plans), and therefore, they run on extremely low margins. As a cost conscious consumer, you win. You aren’t paying for a brand name, huge ad campaigns and associated acquisition costs, subsidized expensive smartphones, deadbeat customers who don’t pay (most MVNO’s are prepaid), retail stores with staff, the cost of building new towers, servers, and a huge network, or any of that stuff.
You pay slightly above the wholesale rates at which network access is bought by the MVNO.
In fact, customers of the big carriers were found to pay about 3.4X the amount of customers of MVNO’s. And if you’re smart about choosing an MVNO plan, that difference is more like 10X.
And here’s the beautiful thing. You’re using the same damn networks!
- Republic Wireless, Virgin Mobile (owned by Sprint), and Boost (also owned by Sprint) – all run off of Sprint’s network. Republic also runs off of T-Mobile.
- Airvoice? AT&T.
- PagePlus and Xfinity Mobile? Verizon.
- Tracfone, Net10, and Straight Talk (all owned by America Movil)? They run off of Verizon, AT&T, Sprint, and T-Mobile, depending on phone and location.
So that “reliability” that the big 4 touts in their ad campaigns is really just an MVNO away.
MVNO’s Fulfill Most Needs & Most Wants (Very Cheaply)
Here’s what I want in a mobile phone plan:
- decent amount of cheap talk/text minutes, so I don’t run out
- a reliable phone with touchscreen and a camera and decent battery life
- memory enhancement capabilities (memory card upgrade), so I can turn the phone in to an mp3 player with a huge library
- wifi capabilities so I can stop at a free wifi hotspot and jump on the web, if needed
Lets put it in the perspective I mentioned in the last article. Up until the mid 90’s, in the entire history of the human race, very few people had a phone at all. And when they did, it didn’t have mp3, touchscreen, or wifi capabilities. Just numbers and a call and power button. And for this phone that was no more advanced than a home phone, they paid $50+ per month for service.
20 years later, all of those wants I listed (above and beyond mid 90’s cell phone capabilities) can now be had for notably less than $10 per month! Paying $115 per month for a smartphone plan seems absurd, when you look at it from that perspective.
A List of the Best & Cheapest Prepaid Plans from MVNO’s
I decided to put together a list of the cheapest prepaid MVNO plans to get you started. This list blends the largest companies with the best reputations and most affordable plans.
These plans (outside of Republic Wireless) are really designed for those who use limited mobile data, in order to keep costs low, paired with wifi. If, instead, you’re looking for more data-heavy plans (including the big 4), check out my articles on the cheapest data plans and the cheapest mobile WiFi hotspots.
|MVNO||Network(s) Used||Cheapest Prepaid Plan||Notes|
|Xfinity Mobile||Verizon||$0/mo. min for unlimited talk & text, + 200MB data (you pay taxes). Beyond that, 2 different pricing options.||Outstanding deal for low data use, with flexibility to add data if needed. Must be within an Xfinity service area to be eligible.|
|Tracfone||AT&T, Verizon, T-Mobile, Sprint||$6.66/mo. min., pricing plans vary.||Get a "triple minutes for life" phone to cut cost of minutes.|
|Republic Wireless||Wifi, then Sprint or T-Mobile||$15/mo. unlimited talk/text/wifi data. (you can add data from there)||Uses wifi, then switches to Sprint or T-Mobile. Can now bring your own phone.|
|FreedomPop||Wifi, then Sprint||$0/month, including unlimited talk, text, and 500 MB data||Uses wifi, then switches to Sprint.|
|Simple Mobile||T-Mobile||$25/mo., includes unlimited talk, text, 1 GB|
|PagePlus||Verizon||$2.50/mo. min. $0.04-$0.10/min., $0.05/SMS, $0.10/MB||With America Movil purchase, changes are likely ahead on pricing.|
|Airvoice||AT&T||$3.33/mo. min. $0.10/voice, $0.10/SMS, $0.066/MB. Pay as you go plan also available.||You can actually run an iPhone with Airvoice.|
- Which MVNO or prepaid wireless plan do you use, and how much are you paying?
- Do you refuse to use an MVNO? Why?
This is a nice overview. If you are fine with what these carriers provide then they are great options. My wife has Family Mobile through Walmart (probably not an MVNO) which offers her everything Sprint did for $30 cheaper a month. She really likes it so far.
Walmart family mobile is t- mobile mvno
T-Mobile sold Family Mobile to Tracfone. We bought my mom Family Mobile before the switch. I was going to sign up for Family Mobile, but the reviews since the switch are bad. Am looking at Total Wireless which is also owned by Tracfone, but for some reason, the reviews are better than Family Mobile.
Total Wireless ROCKS. I have the 4 line plan so $25/mo/line. That’s for 25 GB shared data. We never get close since we have wi-fi at school/home/work. My speeds equal to friends on Verizon. Check out Clark Howard’s reviews (luv that guy)!
I have T-Mobile and pay about $99 a month after taxes and fees. Which is for an unlimited everything plan. I would switch to one of these, but I have to keep unlimited data for work purposes. At least I get a tax write off. I’ll consider these options in the future for family though. Thanks!
There’s nothing special about MVNOs. The issue is prepaid service vs. postpaid service. Check out the prices on T-Mobile and AT&T prepaid monthly plans. As for MVNOs, though, you might add Simple Mobile to the list.
EXCELLENT article. I use Boost Mobile, very satisfied. Starts at $45/mo, after 6 months (assuming you pay every bill on time, throughout), it drops to $40. 6 more months, drops to $35, where it stays thereafter. It’s called “shrinkage” – and I love it because it’s the flat out opposite of the “mysteriously increasing monthly bill even though I’m supposed to be on a contract” that I used to invariably experience with the big 4.
Interesting article. I am curious on people’s opinion of my situation.
Most of my family and friends live in Canada and I live in Michigan. I am currently using Verizon as it is $10 more per month to include all calling and texting to Canada and while I am in Canada.
Is there an MVNO option that would have an add on monthly fee to include calling/texting to and while in Canada?
I have not heard of one yet but I may have been looking in the wrong spots.
If you have an Android phone, look into the Google Voice app. It makes calls to Canada free, if you use it properly. With Sprint (and Ting since it’s a Sprint MVNO), texting to/from Canada while in the US or Canada is free.
Both Lycamobile and H20 Wireless include unlimited international calling in their basic plan. H20 is a little more flexible in that you do not have to have an all inclusive plan including talk, texts and data , you can have a piecemail plan where you pay a low price for a piecemeal plan that lasts three months and then they charge you for each call, text and data usage, so if you do not use your phone frequently you can save a lot of money, the problem with them is they not only do they have an AWFUL website, I spent almost an hour trying to order a phone online and could not, first because the website for some reason was not taking Amex card and then when I tried to use my Visa card, it was not taking that one either so I gave up and also, even they are supposed to be located in Fort Lee N.J. , the customer service agents have very thick accents making them almost incomprehensible however if your problems are not urgent or you do not mind typing, you can communicate via email or chat.
Lycamobile only has all inclusive and although their website says that you can only call people in other companies that also are on their plan, I was told by their CSA that you can call ANY line in the foreign countries they serve.
I meant to say call people in other COUNTRIES, however the international calls are only from the US to the other countries, if you call from within a foreign country to a place within that country or another, it is roaming charges and quite high.
I was a Cingular/ATT customer for 10 years before I switched to Airvoice wireless’ $10/month plan (an ATT MVNO). I was really nervous about the change but I’ve been using them for about 6 months now and I haven’t noticed a difference in service. My only complaint is that I have to manually renew on their website each month and I sometimes forget and go a day or two without service before I notice. The first time it happened the day before Christmas and was really annoying. However I do get service back within minutes of ordering on their website and they seem to be implementing an automatic renewal option, although it hasn’t worked for me yet. Overall, for a very light user, it has been wonderful.
And, if you are worrying about data/smartphone, they allow any phone on their service that will take their sim, including locked ATT phones, but data service is expensive. Luckily data is locked by default, you have to call customer service to enable it. I bought a cheap ($55) unlocked dual sim world phone 6″ tablet and my husband and I share it. I have data anytime I’m at home with my wireless network and anytime I’m in a place with free wifi. So, If I’m out and need to look up something right away I just pull into a Starbucks or McDonalds parking lot.
Between this cell phone plan and Google Voice for a landline, I pay a total of $10 per month for all phone service for my household.
I use Red Pocket I have the unlimited voice, text, and 2GB for $59.99 (tax included if any) a month. Keep in mind this service is great for people who DON’T rely on their smartphone to stream HD videos or you’ll hate the service.
That’s crazy, you might as well be on a major carrier with that price. I’m using Metropcs and I get 2 lines with unlimited talk and text plus 2GB of data for each line. All for $50 total including taxes and other fees.
MintSim (T-Mobile MVNO) has an excellent offering. Unlimited talk/text and 2GB for $15/Month. IT BEATS THEM BOTH!!!
(the 2GB is just the high speed data, after that they throttle it down, you don’t have to pay more for going over.)
They also have unlimited t/t 5GB for $20 and unlimited t/t 10GB for $25.
Go ahead and just try to beat that!
Introductory Price. Next time disclose that in your spam.
I just renewed at the $15 rate as well, although I had to purchase 6 months
Can still be those prices if you pay bulk pricing. I just pay the entire year at a time and get the 10Gb data for $25/mo.
This is not a deal at all. This service is not great…lol
I have been using H2o which is on the att system $28 month unlimited voice / text
I am searching for a better option that allows you to make calls to Mexico. Currently I have an AT&T family plan that is super expensive, even with my company discount… I would love an MVNO but calls to Mexico are a must. Any suggestions like the service to Canada?
Ultra mobile has international calling, check with them for calling to Mexico.
Cricket wireless includes calls to Canada and Mexico in their plans. It should save you a little bit of money too
Freedom pop offers 19.99 unlimited data text n calls.. or free limited plans to certain areas
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…OH YEAH IM USING A IPHONE 4S AND MY DISABLED MOM IS ON THEIR 10 DOLLAR PLAN AND GETS 250 MIN A MONTH WHICH IS PLENTY FOR HER GOOD LUCK GUYS WITH YOUR MVNO SEARCH ONE LAST THING DONT ORDER YOU SIM CARD FROM AIRVOICE SIGHT THEY ARE 4.99 WHICH I PAID BUT I GOT MY ROOMATE ON AIRVOICE AND WE GOT HIS SIM CARD ON EBAY FOR 99 CENTS SAME SIM AS MINE AGAIN GOOD LUCK
I use MintSim and pay only $25/mo. For 10Gb of data. 500mb for $30…not a good deal.
I have Espanol Mobile (espanolmobile.com) I pay $45 unlimited, and for my kids they have basic lines for only $4.99 a month. They have customizable plans..Can’t beat that!
I Moved down from $91/mo. (including equip charges, etc.) to $19 per mo. with Ultra Mobile. Quality is still the same because the underlying network is still T-Mobile’s. But even at $19, you get so much more. You just buy additional Data in 500 MB increment for $5.00 only. Thus you can manage your data costs and overall costs as you need it. Also, calls to/from Canada are included. Very good cheap or free rates to number of foreign countries. So, I really cannot say enough.
Ting is fantastic and a great way to save money! Ting is a Sprint MVNO and includes Verizon voice/text roaming at no additional charge. In February 2015, Ting will also being offering service through the T-Mobile network. Billing is very transparent, post-paid monthly and based on actual usage. At the end of each month, the usage from all devices on the account is totaled and placed in “buckets” based on usage of talk, text, and data (independently). Why pay for an unlimited plan, if you don’t use unlimited talk, text, and data? I used to pay Verizon over $65 per month for my smartphone plan. My bill with Ting is in the $20-25 per month range, saving me almost $500 per year. I’m loving the savings! Ting also offers phenomenal customer service, which is largely unheard of in the wireless industry. This referral link will earn you a $25 Ting credit to learn more and get started: https://z3s3pc329p8.ting.com/
I received a tracfone for X-mas of 2013. A ZTE Valet(Android 4.1.1) it came w/ 1800 minutes and like all Android tracfones includes tripple minutes for life. Also all Android tracfones work on the Verizon network. So, coverage is excellent. I recently upgraded to an LG L34c(rooted optimus fuel) running KK 4.4. Which cost me $15 on black Friday this past year. Due to a couple issues with the Valet I now have over 2500 minutes & service until November 2020. Aside from the expense of the most recent upgrade I have not spent that first penny. I have no qualms with the customer service as I ONLY deal with the corporate office staff.
Last week I bought a Straight Talk home phone base unit. Then an activation card, good for 30 days. Once you connect this with your home phone(not cellular) you have a home phone system for just over $15 per month, including ALL long distance calls. In our area this connects to the Verizon towers, other areas connect with AT&T towers. So far the clarity is better than our AT&T landline(which we plan to terminate in a few days). This system includes voicemail and call forwarding and a few extras. Our signal is not the best(we live in a hilly area) but so far so good. Straight Talk is even giving away their 1st gen units,refurbished, when you purchase an activation card and they will pay the shipping, overnight FedEx, a no-lose situation. I got one, even if I do not use the phone I will use the card.
Have you done any columns on this unit? I am trying to figure out how to direct connect an antenna to this unit, from the outside.
“Here’s what I want in a mobile phone plan:
decent amount of talk/text minutes, so I don’t run out
a full QWERTY keyboard for texting or emailing
memory enhancement capabilities (memory card upgrade), so I can turn the phone in to an mp3 player with a huge library
wifi capabilities so I can stop at a free wifi hotspot and jump on the web, if needed
Whether it’s a dumbphone or a smartphone, it doesn’t really matter, as long as it can do these things. Navigation on a phone is nice, but I can get that with an old school GPS for $75. ”
An almost obsolete BlackBerry OS10 device allows you to easily control data usage done to Mb per month, that, in combination with a low cost GSM service will allow you to control your data usage and keep your cell phone bill low.
If you are a senior, my vote goes to Pure Talk USA in that regards. $15 nets you 600 minutes or 1800 texts which increases to 900 minutes/2700 texts after 6 months and includes 100 Mb of data. Used in combination with an off line map application like navefree and you have a killer combination.
Along with these providers, I think Ting and Tello are some great options as well. Tello runs off Sprint networks and I’ve given it a try and found it to be fairly trustworthy. They do not offer roaming however – which is a killer for many folks – yet their plans start at just $5.
What if I don’t know the carrier. It is a gov’t phone with the free minutes and text. It’s an Android from American Assistance but I do not have any idea who the carrier is for this company. Is there a way to determine the name of the carrier?
The model number of the phone should let you what the underlying carrier is.
Looks like they use T-Mobile.
“Yes. Service within the nationwide coverage area reaches more than 282 million people and is provided on the Nationwide T-Mobile®Network. Coverage is not available everywhere.”
Metro PCS is the way to go. Had Boost but they had poor coverage and speed. Went to Metro who is owned by T-Mobile. Good coverage and speed. On a lark went to Cricket (AT&T) big mistake. Poor coverage, poor speed, no upgrade options. If you want a better phone it’s full price. On Metro if a phone is offered at a discount for new customers you can get that price too. One thing to know is that there is some prioritizing on bandwidth between network providers and MVNO.That is during peak hours network customers get preference and your MVNO download speeds may slow down a little.
Nobody talks about this, but Tracfone sucks because you need to register your sim card with your phone. When you need to insert the Sim card in another phone you’ll have problems.
xFinity Mobile is only available to xFinity internet service customers. Simply being in an area served by xFinity internet means absolutely nothing.
I noticed you never mentioned Consumer Cellular. I have them and they have the best customer service of any carrier on the planet. I’m older than some rocks and I’ve had a mobile phone since the 90’s. They also offer a mobile hotspot and hardware and are reasonably priced. I’m going to activate my business or die trying and you have to look at miles of piles of info. By the way, love your articles and signed up. Thanks for your research and your writing style. I’ve read enough stuffy butts in the last month to tide me over forever.
Ideas, I vacation on an island with only satellite for TV & internet I want to use my Hulu account for TV. Is a hot spot the way to go? What kind of data is needed for TV? Is a prepaid phone plan best way to go? Thanks Ken
Don’t forget to mention
Mint mobile” awesome cheap service , ultra reliable…
I love the fact that in Spain I have 20 GB that are cumulative during another month for only $16,55 (14,95€). Of course it’s a MVNO, but this is sad.
I see everyone is talking about Ting on Sprint, but I’ve got Ting on T-Mobile. We’ve got two lines, use data mostly on wifi and our monthly combined bill is usually under US$25 including taxes. I highly recommend Ting.
Just updating this grrrrrreat article! Mint mobile on Verizon towers. So much better and cheaper than Str.Talk. we love it. Had a love hate relationship with S.T.for six years..(constant babysitting them)….then they lost my replacement phone…….. they said they would replace my new one that exploded coming home from just purchasing at Walmart. OUT $200. No one on the Escalation Team would talk with me on the wheresbouts or the refund. I had 128 polite emails to them and recorded over 85 hours of conversations with their agents all the way up to Escalation Team.
Buyer beware. It could happen to you.
Found Mint and .LOVVVVVE it.
Just wanted to stop back. elise…….. saw your post just in time! Thank you so much!!
Been with straighttalk eight years. Had just gotten a new phone last fall. Had looked way ahead at possibility of 5g hitting the Usa. Asked the zte mfr. And they said it was capable.
Two weeks after I got my phone, straighttalk starts telling me to get a new phone for their 5g. Have spent hours on the phone with them, posted for reply in their forum (post keeps staying unanswered and they have been removing my question altogether in their forum), even sent them postally the info from Zte mfr. That my phone is ready…when they are.
Found your post and went with Mint which said my phone is capable and ready.
A great thing with mint….they have intelligent prople that you can email. Just THAT EASY. not the huge maze of trying to find how to email and not getting good answers (straighttalk).
Thank you elise!!!!!!!!!!!!!
I have the free Gov phone The one I have is safelink and Att is the provider. What I need is a hotspot I think. I have purchased more data as the plan is unlimited talk and text with 1G of data I’ll think anyway they do not offer true unlimited data so I cant activate the hotspot on my phone. I have a Samsung phone. S7 Active that a friend gave me and I love it but in my rural area AT&T doesnt work as well as Verizon. I pay $39 for the extra data and it truly defeats the purpose of the FREE phone. They play on the disabled and less fortunate people. See o my advise is dont pay for the extra. There’s something better. Some of us just need a lil guidance here