Cellular carriers are evil.
Or dumb. Because what but an evil or dumb company would punish its best customers for underestimating the amount of their product that they want? Cellular overage charges are insultingly high. That's why people over-buy the service plans they need: to "save" by making sure they don't get into the carriers' punishing overuse charges.
Can you run a mobile carrier with a more transparent, customer-friendly service model? While charging less for the same service? Tucows will be trying to do so when it rolls out Ting, an MVNO on the Sprint network, in the middle of 2012.
On Ting, as on other mobile plans, you sign up for monthly buckets of services (voice minutes, megabytes of data, and text messages), but there are two big differences from the main carriers. First, if you bust out of your bucket, instead of being charged usurious overage rates, you're just automatically bounced into the next plan up for the month. And if you use much less than what you're signed up for, likewise, you'll be bumped to the next level of service down and get a credit for the difference on your bill. There are separate buckets for voice, data, and text messages.
The auto-bump-up concept is interesting but not a big money-saver for customers in all cases. While traditional carriers' overage fees are hideously high, if you only go over your plan a little, it's still less than paying for the next tier of service. On Ting, a few minutes over will push you into a whole new bucket. But if you go over a lot, you are protected from being charged absurdly high fees. The notch-down option, though, is a gracious and a potential big saver. And Ting's standard bucket options appear to be less expensive than competitors'.
Ting is also a no-contract carrier, so there's no lock-in. You do have to buy your own phone, though, and prices for hardware are naturally much higher than on networks where you sign two-year contracts.
Is Ting a good deal? Obviously, the difference between what you're paying now and what Ting will cost will depend on your usage. I ran some quick numbers for one test case I know well: My own.
My last monthly AT&T iPhone bill was $86, and this reflects a CBS corporate discount. With Ting, for the exact same usages. I would pay $53. Ting probably won't offer the iPhone at launch, but I'm told that it should get it eventually. Also, this comparison doesn't take the cost of the phone itself into account.
Perhaps a more realistic comparison is a two-year engagement with Ting compared to Credo, another Sprint MVNO, with the hardware costs factored in for the highest-end Android smartphone offered on both carriers, the HTC Detail. The Detail costs $495 on Ting; under a Credo contract it is $99.
Under the same usages, the $53 Ting plan with the Detail would cost $1,131 for two years. It would be $1,239 on Credo. That's a savings of less than 10 percent, $108, over two years. But, as I said, the difference for you may vary. A lot.
Ting representatives say that they don't "trap you in contracts," which is technically true. But since the phones on the service aren't subsidized, most people will have to stick with their plan for more than a year to realize the savings from the monthly service.
Ting's transparency is great, though. It is far more respectful of its customers who end up using its service a lot, and far nicer to those who use it less they they thought they would. I like the model.
I don't like Ting's selection of phones (as shown in the site preview I got access to), but hopefully the carrier will get more attractive models before launch.
Could other big carriers do this? It would require them to think of end-user customers in a different way: respectfully. So I am not holding my breath.