Last week news came out that the prepaid carrier Cricket was going to start offering Apple’s iPhone. This is a first, at least in America. Typically, consumers who wanted an iPhone previously would have to sign (or renew) a two year contract with the carrier, often at a price between $80 and $100 depending on how many cell phones minutes they needed each month.
That changes with Cricket. Consumers can now spend $500 for an iPhone 4S or $400 for an iPhone 4 and $55 a month for unlimited calling, text and 2.3 GB of data. (Aside: If you are going to pick a random number like 2.3 at least do something cool like the math constant e or about 2.718.) I am hoping at lot of readers here notice the cheaper plan and think, “Hey, this is going to be a much better deal over the long run.” If so, you we are thinking alike.
However, it’s always best to run the numbers. The cost of the Cricket iPhone 4S over two years is going to be $1,820. The iPhone at another carrier is going to cost $200, plus whatever the monthly rate is times the 24 months. If we do a little reverse math we find that you start to save money with Cricket if your plan is more than $67.50 a month (Math: ($1,820 – $200) = $1620. $1620/24 = $67.50). If your plan is $80, you’ll save $13 a month or $312 over the two years. If your plan is $100, you’ll save $33 a month or $792.
Depending on what you have now, it can either be a significant savings or not much at all. In fact, I’ve heard people somehow get on plans that are under $60… they would lose money by switching. Before you make the move to save money, there are two big things to consider:
- Coverage? – I don’t know much about Cricket’s coverage. I read that in some metro areas it is powered by Cricket itself and outside of those areas it uses Sprint. The good thing about not having a contract is that you are free to experiment and see how it works for you.
- The Looming iPhone 5 – I can’t follow all the iPhone rumors that change daily, but I think I read that the iPhone 5 is coming out in September. So with Cricket, you would be spending $500 on a phone that may be second-rate in 3 months. That’s fast even for the world of technology. If Cricket offers the newest iPhone 5 (which it probably won’t), you could at least try to sell your older iPhone on Craigslist or Ebay and pay the difference to upgrade to the new one.
Update: Virgin Mobile has announced that the price for the iPhone 4 will be $550 and the iPhone 4S will be $650. That goes with $30/mo plan for 300 minutes, $40 for 1200 minutes, and $50 for unlimited minutes. That makes the total two year prices including the iPhone 4S phone: $1370, $1610, $1850 respectively. Unless you need unlimited minutes you are going to save money over the Cricket plan. For those who aren’t big talkers they’ll save close to $500 over the two years.
While that’s an expensive phone, the price could drop when the iPhone 5 comes out. Additionally, at some point there will likely be used options on Ebay and Craigslist that will reduce the upfront cost further.
This is great news if you are in the market for an iPhone. However, if you are open to other smartphones, like me, Google’s Android offers some great deals. For that I suggest Virgin Mobile, which runs on the Sprint network.
I currently have a $25/mo. plan on Virgin Mobile (300 minutes) paired with a Motorola Triumph. The phone cost me $300 (it can be had for around $150 if you buy used now), but the plan saves me $50/mo over what I was paying with Sprint. Over two years that saves me $900, even when accounting for the price of the phone.
Unfortunately, the $25 plan not available for new Virgin Mobile customers. It is now $35 or the same plan. If you want 1200 minutes it is $45 a months and truly unlimited calling will cost you $55 a month. I suspect that most people can make do on the $45 a month plan. A few days ago, Virgin Mobile released the HTC Evo 3D on it, which was Sprint’s flagship phone about a year ago. Someone that signed up for that phone and plan then could have effectively gotten the same functionality for $30-40 less a month by waiting and going with Virgin Mobile.
Who knows if the price of the iPhone hits the right price on Virgin Mobile, maybe I’ll join the Apple Borg as well.
Slightly Related Parting Thought: Three years ago today, I stood in line to get the Palm Pre on webOS. Yesterday, I found it in a drawer that I hadn’t looked in for 4-5 months. After plugging it in, I played with it for a few minutes as it updated all my email accounts over wifi (it doesn’t have function as a phone anymore). I still find it light years better than the Motorola Triumph that I got last year to replace it.
If you have time to read a long article, I suggest you read The Verge’s article on the history of webOS. My favorite line is “As the saying goes, they were trying to skate to where they believed the puck was going; Mercer was trying to skate to where it was.” I believe a mobile operating system built on the web is still where things are going (see: Samsung Chromebook: webOS Clone in a Netbook?), and webOS was there first, but many poor business decisions doomed the innovation from reaching a majority of consumers. Perhaps when Google merges ChromeOS and Android around 2015, mobile technology to get to where it was on June 6th, 2009.