How it all Works

And how to think on more longterm costs.

Americans overpay about $336 per year on wireless bills according to BillShrink. It’s all about thinking in the long term. With a no contract phone, you will be paying for the phone up front. There is no subsidy from the carrier involved lowering the cost of your smartphone, thus a 2 year contract is involved. So what’s your total cost going to be in 2 years or even 12 months? How about in just 6 months? One of the best ways to determine how much more you are paying for a contract phone is to simply do the math and compare plans. Add the monthly bill and multiply it by 12 to get a total for the year. Do the same for the no contract phone bill and see the difference. The amount can be quite an eye opener. Remember, more popular and newer phones will always cost more than others.

So how do you get a phone without contract without paying the “suggested retails price” for it? There are a few options. You can try and buy a refurbished phone. This will lower the initial cost of setting up a new phone plan and smartphone on day one. The hardest part is the initial investment to get started on a no contract cell phone plan but refurbished phones and help lower the cost significantly. In many cases by over 50% since it is considered used.

Another option is to buy a used phone from another carrier but you will need to make sure that that particular phone can be “unlocked” and used with another carrier. One cell phone provider for example which does not allow this with their phones is VirginMobile.com. Those mobile phones can only be used with their system and no one else.

Several interesting studies and surveys usually come to the same conclusion. That is, most no contract cell phone users do not use as much talk time, text messaging and data as 2 year contract phones. As to why is subject to interpretation; are no contract users only using what they really do need or are they trying to save on a monthly basis now that they have the “penny pinching” mindset because of the switch?

It is interesting to note, that no contract cell phone plans are becoming more and more popular since the almost stigma like reputation no contract mobile phones have had in the past. They were either very basic phones (no smartphones), bad service or poor reliability.

Need a contract-free smartphone solution?

Facts & Numbers

435MB – the average amount of data an average smartphone user consumes per month (Q1, 2011). *

$0.08 (8¢) – The mean cost per megabyte of data used across existing mobile carriers (Q1, 2011). *

$0.02 (2¢) – The cost per megabyte of data used with Ting assuming XXL Megabytes plan.

$336 – The average amount Americans overpay per year on wireless bills. **

Facts & Numbers

711 – The number of wireless minutes Americans estimate they use per month. **

651 – The actual number of wireless minutes Americans use per month. **

2,566 – The number of text messages Americans estimate they send per month. **

1,555 – The actual number of text messages Americans send per month. **

A QUICK BUT IMPORTANT STUDY ON HANDS-FREE DEVICES

Hands-free is usually considered a much safer way to communicate via cell phone without using your hands. This provides less distraction for the driver and is law in many states resulting in hefty fines if not used while talking on a mobile phone. However, according to a recent study conducted by the AAA Foundation For Traffic Safety, distractions still exist while using these hands-free devices. The distraction usually involves delayed or slowed responses to traffic scenarios and tasks while driving a vehicle. Drivers will also spend less time scanning roads and much more likely to miss visual clues.

The tests were scientific as researches at the University of Utah measured actual brainwaves and eye movements along with other various metrics to record what happens to a driver’s mental workload as they attempt to perform multiple tasks at once while driving a vehicle.

Driving behind someone who is talking on the phone usually is noticeable even when using a hands-free device but especially when not using a hands free device, and even worse is when they are texting. Drivers tend to sway more while on the road, taking longer than usual to start moving again after the light turns green and braking later than normal. All the more reason for some states to write up hefty fines for using cell phones while driving. If you notice such a driver, make sure to keep your distance and be extra aware of any late or sudden braking and patchy behavior. Best to avoid such drivers by changing lanes and keeping your distance.

A hands-free device does not mean a risk-free commute.

Any type of distraction while driving is a safety risk and does not always have to do with smart phones but any kind of distraction from passengers, changing radio stations to trying to adjust the seatbelt. Driving at 65 Mph does not provide you with much reaction time even when you are devoting all of your attention to driving and paying attention to what is ahead of you while scanning about a mile ahead. Distractions can only make this task more difficult and dangerous while at these speeds but also et lower speeds. It is not worth the risk of getting into an accident if the call could be made at a later time.

The US government sites that for 2011, over 3,00 people were killed due to distraction alone.

Unfortunately it may seem that more drivers are using hands free devices assuming that it is safe to do so since drivers are no longer “distracted” and using their hands while driving. Unfortunately more cars are coming equipped with infotainment systems and AAA predicts that there may even be a five-fold increase in such devices able to not only play music but also show movies, navigate, stream content from the Internet such as Pandora and even communicate with your home appliances.

Even though Ting.com may make using your phone much cheaper than 2 year contract phones since you have no contract and very low monthly bills, it is still strongly advised to put the smartphone down until you are done driving. It’s just not worth the risk, especially if you have distracting passengers that you try to ignore by trying to find a good radio station!