Tucows has announced a new mobile phone service. It is affiliated with Sprint but requires a different device (why there is no help there from Sprint I do not know). I have not read a full analysis or the technical nitty gritty, nor have I seen a performance reading. Let me start off by saying this is not carved in stone and there may be facts that change how it sounds so far. However, the few things I do know are pretty interesting, and may have a real impact on how mobile service works in the future.
For starters, you pay full price for your phone. That sounds cringe-worthy but the reality is that mobile companies are already moving to that. T-Mobile’s “value plans” give a superior monthly rate but customers pay a downpayment on phones and eventually the full amount through installment payments. Verizon and AT&T have made changes with how customers get phones, none of those changes to the benefit of the consumer. Anyway, the days of free phones will inevitably end. It was okay when phones were basic, but as they have developed into mini-computers it just isn’t practical. Those who don’t use a power phone won’t have to pay for one, so in the end it really works well for the people who have paid higher rates to offset the cost of high end devices that other users are taking advantage of.
But here’s where it gets cool.
First, if you don’t use all that you paid for, they credit it back. Yup, as unbelievable as that sounds, it’s true. If you go over, you pay an overage rate “without penalties” but the details are fuzzy on that point. There is no explanation as to whether they allow you to upgrade your plan to fix overages (something most companies currently do). It lets you completely divide up your service, customers will not be forced to unlimited options. If you use few minutes, tons of text and no data, you can set yourself up just that way. The usage trend is very much biased towards texts and data, which is why the bundling approach is screwing consumers instead of saving them money. Older or more traditional users are the exception to that rule, but they are a much smaller group. This also removes the “required web” that many companies are forcing when customers purchase certain devices. The customer’s control over what they pay and use can be completely customized.
The pooled service and add-a-line is fair too. For the first time ever, a family can share a data bucket, which means the cost will be far lower than the current per-line setup. Instead of two or three family members paying a steep markup and the others paying overages, one adjustment fits everyone. Six bucks per line is lower than industry standard, too.
Of course, there is plenty of reason to keep a skeptical eye on how this works out over a year or two. There are a lot of blanks left to fill in, and a lot of questions that I would like to see answered. It does something incredible though, in theory. It makes mobile phone service fair, where heavy users pay heavy prices and light users can get a minimal plan. It lets families share what is purchased without forcing upsells and extra fees. Large families could see a huge price drop based on usage. Power users can finally have the unlimited that they need without a contract. Once customers test the system for weaknesses and flaws, the end result has the potential to create unprecedented competition among the Big Four.
There are several major complaints among cell phone customers. Price, choice, devices, quality, contracts and customer service. This has the potential to force major carriers to start cutting our prices and giving customers more choices. It’s been a while since the big carriers have cut the masses a break. Right after AT&T told customers they’re footing the bill for the T-Mobile fail, this news couldn’t have broken at a better time.