Should You Switch Wireless Plans?

Read the fine print before you jump to another network.

By Paul O’Reilly

In a sure sign that the US mobile market is rapidly maturing, it appears that some wireless carriers are less concerned about attracting new customers to the wonderful world of smartphones and tablets and are instead concentrating more on luring existing customers away from the competition. This has led to a jumble of early upgrade offers, termination fee payments, and other incentives, as the emphasis switches to the cost of wireless plans rather than the ever-improving excellence of the devices themselves.

While this may sound like good news for wireless subscribers, it has mostly led to more confusion in a marketplace that wasn’t exactly a model of clarity in the first place. If you thought it was hard to choose the right wireless plan before, try figuring it out when data allowances change every month, extra gigabytes are thrown in on a seemingly random basis, and one carrier is even offering to cut your existing bill in half.

This last promotion comes courtesy of Sprint and, perhaps more than any other offer, it highlights the complexities facing consumers as they try to save a few bucks on their monthly wireless payments. Taking a page out of T-Mobile’s playbook, Sprint specifically targets customers of the two biggest carriers and asks them: “Wanna cut your monthly Verizon or AT&T bill in half?” Of course, like many of these offers, the details are in the fine print – in this case over 550 words of fine print.

Sprint’s offer starts out looking reasonable enough. You have to turn in your old phone (or multiple phones if you are on a family plan) and sign up for a brand new one with a two-year contract, but you would have to do that with your existing carrier eventually anyway. Sprint will even pay up to $350 per line in termination fees, although you might have to wait up to 12 weeks for the money to arrive in the form of a Visa Prepaid Card.

However, there is one thing to note about turning in your old phone under the Sprint deal: you get nothing for it, even if it’s a phone with good second-hand value like an iPhone 5 and you have paid it off in full. But again, this is probably not a deal-breaker. That phone was most likely destined for the kitchen drawer anyway.

However, as you keep going with the fine print things start to get a little murkier. You eventually discover that Sprint is not offering to cut your whole bill in half but only the amount you pay for talk, text and data. As most people pay nothing for talk and text, that’s half off what you now pay for data. Depending on how much data you use, that could be a little or a lot, but again, you’re only saving half of one line of your monthly statement rather than the whole bill.

But if you’re a heavy data user – heavy enough to make a 50 percent saving worthwhile – there’s one big problem with switching to Sprint: according to a recent RootMetrics report, it’s got the worst network of all the top wireless carriers.

Not only is Sprint’s inferior network likely to result in slower download speeds and less reliable performance, it could also have real unforeseen consequences for your new Sprint deal. Again buried in the fine print, there is language suggesting that other plans (i.e. plans that pay the full data rate) might receive “prioritized bandwidth availability.” In other words, in times of heavy data traffic, half-price ex-Verizon and AT&T customers will have to wait.

Even worse, there is also a clause that allows Sprint to terminate your plan if more than 100MB of data usage each month is “off-network,” i.e. data consumed while the user is outside of the Sprint network. Considering that my family gets through 300MB a day and Sprint has the smallest network in the country, this is definitely not a deal for anyone that uses more than a few hundred megabytes of data a month.

And there’s the rub. The “cut your bill in half” promotion from Sprint is really only designed for low data users. But if you are a low data user, you aren’t going to see much in the way of savings anyway. And if you are a Verizon or AT&T customer, you are going to exchange those meager savings for a markedly inferior network.

As it continues to mature, the wireless space is starting to look more like the rental car industry, where Hertz and Avis charge premium prices based on service, reliability and network, while the competition carves out a variety of lower-priced alternatives. Of course, a maturing marketplace also results in more knowledgeable consumers, who are better equipped to make sense of the myriad of choices they now face. If you’re a wireless customer, you might want to remember the old adage that has guided savvy shoppers for countless generations: You get what you pay for.

You can follow Paul on Twitter.

The Online Mom LLC receives a fee for participating in certain promotional programs for Verizon Wireless.     

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