Smartphone prices vary wildly among the different carriers, and it's not always easy to guess which will be the cheapest. For example, variations of the HTC Snap was recently launched on 3 separate carrier under 3 separate titles: as the HTC Snap on Sprint, the HTC Ozone on Verizon Wireless, the T-Mobile Dash 3G. All these phones were quite similar in features, but prices varied wildly from only $50 with a contract on Verizon to $170 with a contract on T-Mobile. But that initial starting price only tells part of the story.
To get the most out of a PDA or smartphone, you'll need to back it up with a data plan and a plan that includes plenty of text messaging. Once you take these features into account, the starting price for the phone matters much less, and you can figure out just how much you'll be paying for that smartphone over the course of a 2-year contract. We looked at the 4 major carriers from this perspective.
For our analysis, we checked pricing for the plan with the cheapest option for cell phone minutes, as well as the unlimited calling options that are becoming more popular with in the U.S. market. We decided that unlimited data and unlimited text messaging were a must for heavy smartphone users. Many smartphone users will also want to take advantage of tethered modem support, which lets you connect your cell phone to your laptop as a fast, 3G Internet connection on the road. Surprisingly, each of these permutations resulted in a different carrier offering the best bargain.
Fewer minutes, maximum data
If you're like us, you don't use your smartphone for talking as much as you use it for Web browsing, e-mail and messaging. You probably don't tether your phone to your laptop, either, because you can perform most tasks on your phones Web browser. For you folks who want the best your smartphone has to offer, but want the cheapest option available with the fewest minutes attached, Sprint is the best choice. Sprint offers an Everything Data plan with unlimited Web browsing and unlimited messaging, as well as 450 anytime minutes, for $70 per month. That brings the total price to $1,680 over a 24-month contract.
T-Mobile is also a great choice. T-Mobile's basic calling plan costs $40, and it includes less minutes than its competition; 300 compared to 450 on the other carriers' most basic plans. But that 300 minutes also comes with unlimited calls to your 5 favorite people, T-Mobile's so-called myFaves option, and this could make all the difference if your calling circle is more limited. T-Mobile's unlimited Web plan is also the cheapest of the bunch at $35 for unlimited data and messaging. This brings the total cost to $1,800 over 2 years.
Tethering problems
Unfortunately, neither of these options are good for folks who want tethered modem support. T-Mobile doesn't officially support tethered modem access. It works on some of their phones, but if you try it you'll be violating your contract. They could cut you off completely or try to charge you exorbitant overage fees. T-Mobile doesn't have an official policy to deal with tethered modems, so we'd advise against using their devices for this purpose until they come up with a concrete option.
Sprint charges a huge monthly fee for tethered access: $60 per month. You can get a $10 discount if you sign up for a more expensive Simply Everything plan, which comes with unlimited minutes as well. But even at that price, you're still paying an extra $1200 per year for the tethered option. That's seems awfully high, but in the end Sprint users might actually come out ahead.
The best plan for hardcore data users
On the larger carriers, tethering becomes a much more reasonable proposition. On Verizon Wireless, tethering support is an additional $15, and on AT&T it's only $10 more to add tethered modem support. Both of these carriers also offer reasonable prices on unlimited talking plans.
AT&T offers unlimited minutes for $100, with an unlimited Web and messaging plan for an additional $50. That includes Web browsing and text messages. With the $10 fee for tethered support tacked on, that brings a 2-year, fully loaded AT&T contract to $3,840. That's $120 cheaper than the same option on Verizon wireless, over the course of a contract agreement.
Sprint's option is even better, especially if you don't need the tethered support. Without that extra $50 fee, Sprint offers a Simply Everything plan this includes unlimited everything for $100 per month. That brings a 2-year total down to only $2,400. Even with the tethering fee, you can still get away with paying only $3,600 for a 2-year Sprint contract.
Our conclusions
For the most part, Sprint comes away a clear winner, with cheaper options all around, thanks to their Everything Data and Simply Everything Plans. It might feel like Sprint is gouging customers by charging $50 per month for tethered modem access, but even with that extra fee, their total cost is still the lowest. T-Mobile is also a good option, especially if you can take advantage of the myFaves program to cut your minutes down to 300 per month. In that case, T-Mobile's basic option might be the best choice.
The two larger carriers, AT&T and Verizon Wireless, were much more expensive for all of these options. Of course, network coverage can be a serious issue for some buyers, so if you don't have great Sprint or T-Mobile 3G coverage in your area, we'd suggest going with AT&T if you're looking to save a little money.
The bottom line is that even though T-Mobile might charge much more for their recent smartphone releases, over the course of a 2-year contract, you'll end up paying more than $300 more if you stick with one of the 2 major carriers. But the biggest difference is between buying a phone like the Palm Pre on Sprint versus buying the Apple iPhone 3GS on AT&T. With unlimited calling and data, and leaving out the tethered modem option that neither phone supports, we can say that Sprint's is being honest when they claim the Pre costs $1,200 less over the course of a 2-year agreement.
Smartphone Plan Comparison
(August 4th 2009) |
| Plan |
T-Mobile |
Verizon |
AT&T |
Sprint |
| Base |
$40 (300 min) |
$100 (450 min) |
$40 (450 min) |
$70 (450 min) |
| Unlimited Calling |
$100 |
$150 |
$100 |
$100 |
| Unlimited Web |
$35 |
Incl. w/ Plan |
$50 |
Incl. w/ Plan |
| Unlimited Messaging |
Incl. w/ Unlim. Web |
Incl. w/ Bundle |
Incl. w/ Unlim. Web |
Incl. w/ Bundle |
| Tethering |
Not Officially |
$15 |
$10 |
$60 / $50 |
Total cost for
2-year Base |
$1800 |
$2400
($2760 w/ Teth.) |
$2160
($2400 w/ Teth.) |
$1680
($3120 w/ Teth.) |
Total cost for
2-year Unlimited |
$3240 |
$3600
($3960 w/ Teth.) |
$3600
($3840 w/ Teth.) |
$2400
($3600 w/ Teth.) |
| Sources: T-Mobile, Verizon, AT&T and Sprint |
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