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Over the weekend, I did a bit of research into my crazy new idea. As my Palm Pre was put on notice back in November, I’m looking at dropping it for an fast, new Android device in the first quarter of 2010. I have an iPhone […]

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Over the weekend, I did a bit of research into my crazy new idea. As my Palm Pre was put on notice back in November, I’m looking at dropping it for an fast, new Android device in the first quarter of 2010. I have an iPhone 3GS as my primary cell and I’m an advocate of using Google Voice to manage my incoming calls — it’s especially handy with more than one handset. So I really don’t need two or more voice lines with my current setup. Using the Nokia N900 for both Google Talk and Skype voice calls actually sheds the spotlight on this fact — with fantastic Google Voice or voice over IP integration, a second “handset” could easily be a data-only device for me. That’s where my research for a data-only SIM card started… and quickly ended due to the dreaded ETF, or Early Termination Fee.

Since the new Google Nexus One offers known specifications that will meet my needs, I decided to look at T-Mobile for data. The carrier recently introduced some contract-free voice / text / data plans, so I figured there might be a plan for my new strategy. Sure enough, I found the T-Mobile Total Internet plan, which is $39.99 a month and offers up to 10 GB of data per month. With the plan, you can make voice calls, but you’ll be paying by the minute. That’s a chance I’m willing to take, since I have another dedicated handset for voice and because I’m thinking that a Skype phone number ought to provide cheap insurance. And most of the folks that I talk to on a regular basis are all on Google Talk already, which works just fine over 3G or Wi-Fi. So I added the plan to my cart.

The next step was to choose a device, but since I’ll be providing the hardware, I simply chose the first option, which was for a free SIM card. Thinking I was good to go, I went to checkout and then the dreaded two-year commitment and $200 Early Termination Fee information popped up. Here’s the burning question: if ETFs are meant to protect carriers against early losses of subsidized hardware, why would there be an ETF associated with a data-only plan? The fact is — there shouldn’t be one and it’s tragic that the FCC allows for this to happen in the U.S. Ironically, after tweeting about this over the weekend, T-Mobile has updated it’s site and I currently can’t choose just a SIM card for this plan.

While it may appear that I’m bashing T-Mobile over this, I’m simply using this situation as an example. The fact is: I want to give T-Mobile $40 a month to use unlocked phones as data-driven devices. But I won’t do that if there’s an illogical fee that I could end up paying for. What if I have a career change in the next two years and don’t need to review phones any longer, for example?

This is part of the reason that unlocked phones simply don’t do well here in the U.S. In other countries, carriers often use the same voice and data frequencies, so you simply shop around for the plan and SIM card that suits you best, pop it in your phone(s) or your data device and you’re good to go. Here a SIM card for an unlocked phone works with either T-Mobile or AT&T for voice, but unless the device supports quad-band HSPA (most, if not all, don’t), you only get fast 3G data on one network or the other. There’s simply little to no incentive to buy an unlocked phone like the Google Nexus One.

Let’s say for a second that the Nexus One will be unlocked — which is all but officially confirmed. It won’t support AT&T’s 3G network, so very few people will even consider an AT&T SIM or plan. Why would you when the primary use case of the device is for apps and the web, which are data-driven services. These days, the voice component of a smartphone is more of a necessary add-on rather than the primary function. So that brings you to T-Mobile, which does offer contract-free plans with the Even More Plus Plans. The cheapest one offers 500 voice minutes along with unlimited text and web for $59.99 a month. That’s $20 more per month than the Total Internet Plan because it offers the voice and text component — that I don’t need. Texting through Google Voice on an Android phone — or via the web on any other platform — is just fine.

In fairness to T-Mobile, let me look at the situation with AT&T — you can add just the data component to a smartphone or PDA for $35 a month. OK, that’s reasonable, but what if I don’t need the voice component? No can do — this is an add-on for existing voice plans. For data only , you need a SIM card tied to the $60 a month DataConnect plan, which nets you the same 5 GB of monthly bandwidth for almost double the price of the add-on. There is a $35 plan, but that’s limited to a paltry 200 MB, so it’s a non-option for me. So let’s say I was willing to go with the $60 a month data plan — you can’t do that with just a SIM card, at least not on AT&T’s website. Instead you have to pick a device and we all know what that means. Yup, this is where the ETF comes in again. Either that, or I can buy a device I don’t need at full retail price, which is often higher than the ETF in the first place.

Simply put, this whole experience is like running on a treadmill — I keep going and going to find a solution, but essentially, I’m stuck in place. It’s time for a real shakeup in the U.S. cellular market because data, not voice is where it’s at. I don’t know who will cause this shift — the FCC, Google, or someone else entirely — but it’s long overdue. I know I’m a bit ahead of the curve on the need for data-only plans without ETFs, but these territorial cellular fences need to be torn down.

  1. I generally liked this entry, but disagree with one point: ” These days, the voice component of a smartphone is more of a necessary add-on rather than the primary function.”

    I’d venture to guess that the vast majority of smartphone users also use the phone for voice. I’d further venture that only the geekiest among us use VOIP on their smartphones (I don’t actually), or carry more than one device unless the second device is a work cell phone.

    D.

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  2. Data only is not viable yet. I certainly don’t want to lag around multiple smartphone devices but just one. Until HSDPA is widely accepted as currently 2G is there is no talk about data only smarphone sim cards.

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  3. Any idea if any of those 3G data sticks have a SIM card?

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    1. All 3G data sticks / cards on T-Mobile and AT&T do have SIM cards.

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  4. I COMPLETELY agree with the author. This is exactly what I want to do as well. I’m currently “in a relationship” with AT&T for my Blackberry Bold. Know how many voice minutes I used last month? 13! And that was a busy month.

    I just don’t have a need for a cellphone. I do have a GREAT need for email and internet on my device. The US cellular market is antiquated at best. Times are changing and the cell providers are not changing with the times. Sure, they have data plans; but as Kevin wrote, they’re in addition to the voice service. You’ll laugh at this; but the PEEK email device is actually a brilliant concept. For as little as $15 a month you can get unlimited email. That’s awesome! But it has no internet capabilities which is a deal killer because I have to have access to the web.

    I seriously think that the first carrier that would do something like this would OWN THE MARKET! There are a lot of data only users out there!

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  5. There is a MVNO that uses data-only SIMs with a customized Touch Pro 2, IIRC.

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  6. i’m still looking for a laptop (for the big keyboard) that can be used for: cellphone, texting, web access through 3g, 4g, and wifi, gps with assoc. programs and loadable maps for terrain, and blue tooth.
    i know you can use skype for calls, but how about all the apps?

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  7. GoodThings2Life Monday, December 21, 2009

    My CEO just exchanged his Pre for a Samsung Moment. It’s the first smartphone we’ve given him that he actually said, “Wow. I like this.”

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  8. I was running into this same exact issue last week. I would like to find a data only plan on a GSM network so I can easily switch phones.

    The only reasonable plan out there is Sprint Relay for 29.99, unlimited data, free text, no phone calls. This is meant for the hearing impaired but I went through the checkout process with out ever asking if I was hearing impaired. The problem is that its CDMA which means no SIM, and no Nexus.

    http://www.sprintrelay.com/

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    1. You hit the nail on the head in my case — Sprint is CDMA and most of the phones / devices I use or review are GSM. When we get a CDMA device for review, we’re generally provide service during the review period as well, so a CDMA data-only plan doesn’t buy any flexibility. :(

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  9. Look at Cricket. That won’t get you a sim card, but it will get you a no contract all you can eat 3G Broadband card for $40/month and no contract. Right now the 3G Broadband modem is selling for $50 with a $50 gift card rebate.

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    1. Cricket won’t work in this case – they’re CDMA too.

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  10. There is an express card, Option GlobeTrotter® Express 442, and a USB modem, Option iCON 452, which has 3G for both AT&T and T-Mobile. Those devices are the ones I would consider if I wanted data-only and wanted the freedom to choose any US or European provider.

    I have a “data-only” sim from AT&T that I got years ago so it doesn’t have the 5GB cap and I’ve thought about trying to use it for VOIP only calls if I can find the right device for it.

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