Mobile Phone Plans & Charges

Monday, 20 June 2005 at 5:00 am Pacific USA Time.

I’m calling this good marketing because it ropes people in every day, even if the choices those people make aren’t always the best.

Take your mobile phone plan. You probably get a certain number of minutes included plus some other but limited features (like text messaging) that are included. You pay a monthly fee, let’s say $60 (plus taxes), and if you go over your minutes, you’ll pay 40 cents per minute ($24/hour… more than most people make at their jobs!). Maybe you’re on a family plan. Those are normally smarter, right?

What happens. You have one or more months where everybody on the family plan went way over. Your bill is $300, and you’re stuck paying it. You wish you could move to a totally different system, but you’d be stuck with early termination fees. Two things to consider.

1) I don’t know if other carriers offer this, but Nextel offers a plan where everything is unlimited. Unlimited incoming and outgoing calls, unlimited long distance, and unlimited direct connect (their walkie talkie feature). It’s $199.99/mo, which is less than your bill for going over your minutes for one month. If you’re using your phone for everything all the time, consider a completely unlimited plan.

2) Do the math on the early termination fee. Say you want to move to Sprint’s "Fair and Flexible" plan, where you pay $5 for every 100 minutes you go over (rather than $40 for those extra minutes on your plan). How many months of going over would you have to have for those early termination fees with your current carrier to pay for themselves? You’re already paying over $200 extra this month (in my example). Moving might save you enough money where the early termination fees end up paying for themselves over time. Don’t be afraid to cancel and move!

One carrier advertises "anytime" minutes, which is supposed to put down the carriers who have day time minutes and then free nights and/or weekends. Which is smarter? If the "anytime" carrier really isn’t giving free nights and weekends, you could end up burning a lot more minutes there because every minute you talk counts against your monthly minutes. If they claim "anytime" minutes and then have free nights and weekends, then "anytime" is just a marketing gimmick.

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Categories: That's Good Marketing

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