Most wireless pricing plans include a certain number of minutes per month (often called a basket or bucket of minutes) for a certain price; any minutes over that specified amount are charged on a per-minute basis. Any unused minutes at the end of the month usually expire. Carriers generally offer several variations of these types of plans with increasing baskets of minutes at increasing monthly fees. Carriers also vary their service plans by where subscribers can use their phones without incurring additional roaming and long distance fees.
Before the advent of bucket pricing plans, carriers charged subscribers a per-minute fee for each minute of airtime on every call. Some carriers still offer these types of plans today. With these plans, calls made during certain peak times of the day - generally business hours - often cost more, and calls made during other off-peak times - generally nights and weekends - often cost less. Again, which times constitute night and weekend vary by carrier.
Many carriers offer plans that include a basket of minutes that can be used anytime during the month plus a larger basket of minutes that can be used during certain times, generally nights and/or weekends. Which time periods constitute night and weekend vary by carrier. With the majority of pricing plans, consumers pay for both outgoing and incoming calls. In the case of bucket plans, the minutes from both outgoing and incoming calls are usually deducted from a customers monthly bucket of minutes. However, some carriers offer pricing plans where all or some of the minutes of incoming calls are free to customers.
In general, mobile carriers charge by the minute. When you use a fraction of a minute, many carriers round up to the next minute, charging or deducting subscribers a full minute when only a portion of it is used. However, some carriers offer plans that round to the nearest second instead of minute.
Carriers have traditionally charged per-minute roaming fees on calls made from the network of the carrier that has a roaming arrangement with your carrier from a location outside of a customers home calling area. However, several carriers have eliminated these fees in their nationwide pricing plans.
All of the major mobile carriers offer pricing plans that allow customers to purchase a bucket of monthly minutes to use on a nationwide basis without incurring roaming or long distance charges. Consumers should be aware that how carriers define nationwide varies. For some carriers, this means being able to use your phone anywhere in the country where any type of signal is available at no additional charge. For other carriers, it means being able to send and receive calls only on the carriers network without incurring roaming and long distance fees. These carriers networks generally extend through the countrys more populated and highly-traveled locations but do not cover the entire United States.
Cell phone users have traditionally had to pay additional fees for long distance calls. Long distance calls are generally calls made to locations outside of a customers home coverage area. However, some carriers may define long distance calls differently for purposes of their pricing plans. Several carriers offer pricing plans that eliminate per-minute long distance fees. Some plans charge no long distance fees for calls made from a customers home calling area, some for calls made from anywhere on a carriers network, and some for calls made from anywhere in the United States. Whenever a long distance call is made, the mobile telephone carrier determines which long distance carrier will complete the call, unlike with landline service where the customer chooses the long distance carrier.
With prepaid service, consumers purchase a handset and pay for a fixed amount of minutes prior to making any calls. There is usually a set time period in which unused minutes will expire. Prepaid minutes are often subject to peak and off-peak airtime rates. When prepaid customers have used up their minutes, they can refill them. Carriers do not obtain credit history reports on prepaid subscribers as they generally do with other subscribers.
With most bucket pricing plans, any unused minutes expire at the end of the month. However, some carriers offer consumers the option to roll their unused minutes over to the next month.
Many carriers charge a one-time fee to customers when they initiate service, called an activation fee. Carriers will sometimes waive this fee as part of a promotional pricing plan.
In addition to SMS, many carriers now offer mobile data services that allow customers to exchange e-mail messages, download games and ringtones, send digital photos, or access the Internet via a handset, PDA, or laptop. There are generally a variety of pricing options for these mobile data services, including per-minute, per megabyte, or unlimited usage for a flat monthly fee. Consumers are encouraged to review all of the information on the specific capabilities of these services and their pricing options before purchasing.
Most carriers require new subscribers to sign one-year contracts or service agreements when they sign up for a new service plan. Most charge an early termination fee to users who cancel their service plans prior to the end of that year. Some carriers offer additional incentives to subscribers who sign up for two-year service agreements. Consumers should carefully read any potential service contract prior to signing up for service.
SMS provides the ability to send and receive short text messages to and from mobile handsets. Some carriers charge a few cents per message to use SMS, and many offer SMS packages which include a set number of messages for a flat monthly fee.
Special options (also known as vertical services) include such things as call waiting, Caller ID, voicemail, call forwarding, and three-way calling. Carriers offer these to customers as add-on features beyond simply dialing and talking. Some of these options are included in the monthly price of most digital calling plans, while others are generally offered at an additional monthly or per-use charge. Many of these features may not be available on analog networks.
Many carriers, including all six nationwide carriers, permit customers to cancel service without paying the termination fee if service is cancelled within a certain period of time after the service contract is signed. These trial periods generally range from 14 to 30 days, depending on the carrier. Consumers are encouraged to find out the length of a carriers trial period before signing a service contract, and may wish to consider the length of trial periods as a factor in selecting a wireless carrier. In addition, consumers should use this time period to determine whether their carrier provides adequate coverage in the areas where they use their phones most frequently, such as at home or on their commute to and from work.
The format of monthly bills varies by wireless carrier. Some carriers automatically provide detailed content, such as a list of every call made that month its duration, and whether it was roaming or long distance. Other carriers offer detailed billing as an option for an additional monthly fee. Consumers should get information from carriers on billing before signing up for service, and may wish to consider billing and bill format options as a factor in selecting a wireless carrier.
Source: Federal Communications Commission, Consumer & Governmental Affairs Bureau