Connecting with the Right Plan
By Brian Zimmerman
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Cell phones are quickly joining computers as leaders in innovation and masters in leaving behind obsolete technology -- seemingly every day. Current cell-phone sales will be overshadowed by new models -- one with more glitz and better options -- almost as soon as the sale is made. With a variety of plans designed for every lifestyle, many new cell-phone users are actually taking the shape of the family -- connected by multi-phone, multi-line cell phone plans. The result is a maze of options, accessories and restrictions, which makes shopping for a new phone more of a hassle than it needs to be.
"You almost have to work for a cell phone company to be able to understand all the different rate structures," Steve Rhode, president and co-founder of Myvesta, a non-profit consumer-education organization, said.
"Most people sign up for plans that sound good on paper without researching all of the available options. That ends up costing big bucks in the long run," he said.
Rhode says he has been able to save his clients money by negotiating with their cell phone carriers through Myvesta's AllPaid program. "We have many different clients on different calling plans with the same cell-phone company, and they all pay a different monthly rate," Rhode said. "With one cell-phone company, we negotiated to switch all of our mutual clients to their low-cost plan, which saved some people as much as $50 a month without a change in service."
For casual cell phone users, Rhode suggests tracking your phone calls for a month.
"Start by figuring out how many minutes you need and if any of them are out of the area," he said. "Then call your current carrier to see if they will switch you to a lower-cost calling plan that matches your needs. If not, figure out the cost of terminating your contract and start shopping around. If the termination penalty is less than the saving you'll accrue with a new plan, tell your current carrier to take a hike."
"If you want the convenience and safety of carrying a cell phone but don't use one very often, consider using a pre-paid wireless plan where you can carry as you go." Sherri Pfefer, director of public relations for TracFone Wireless says that families looking into purchasing a cell phone should also consider prepaid wireless options.
"Not all family members have the same calling patterns," Pfefer said. "Many talk less."
But according to representatives for popular cell-phone service providers, service contracts and multi-line accounts are the way to go -- if users plan on making full use of their phones. T-Mobile has plans designed exclusively for families," said C. Riana Manuel, a representative for Sprint.
FamilyTime plans by T-Mobile allows a family to share up to five phones (minimum of two lines required) and 800 whenever minutes each month with the option to upgrade to a plus package and receive an additional 400 minutes each month. According to Manuel, Sprint plans offer multi-phone plans -- as many as a customer's credit allows. Each additional line costs $20 each month, she said.
Laura Merritt, marketing manager for Verizon Wireless, says that their new family plans are wildly popular among families today. "It's amazingly popular -- more than anyone anticipated," she said.
Merritt says family plans are perfect for families with children going away to college.
"If they give them their own cell phones, they end up saving money rather than using the phone in the dorm room." In addition, Merritt says that cell phones offer families and children "a sense of continuity that they appreciate" by keeping everyone connected.
Along with cell phones has been the birth of text messaging, a service that has "`exploded" due to teenagers using wireless phones.
"It's a very popular form of communication," Merritt said. "Young people have really embraced it."
Text messaging offers a cheap alternative to making a phone call. Merritt said that 1 million text messages have been sent by Verizon Wireless customers in the first six months of 2003.
Experts say that shoppers should do the necessary research to help identify their needs.
"Our site has the Internet's only Family Plans rate calculator," Allan Keiter, president of myrateplan.com, said. "This tool takes into account that some family plans offer free airtime when those on the plan talk to each other. More generally, family plans are a good way to provide service to the whole family, as the shared minute component often creates less overall wasted minutes," he said.
Keiter also suggests that families only buy the coverage that they need. "Some people buy national plans for convenience (i.e., no roaming costs), but each minute included in those plans is more expensive than a local plan," he said. "So, if you're not traveling, don't buy a national plan."
He also suggests that cell-phone shoppers buy a little more airtime than is needed. "This applies to both single and family plans," Keiter said. "The cost of minutes within a plan is cheap, often under 10 cents a minute. However, it is often 40 cents or more once you go over. This could quickly add $15 to $20 to your bill -- or more," he said.
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