Ask Maggie: On Wi-Fi-only vs. Wi-Fi + 3G iPad 2

In this week's column I offer some advice on whether to splurge on 3G for the iPad 2 or rely on Wi-Fi and a hot-spot-enabled iPhone 4 for connectivity.

As new smartphones and tablets come on the scene and as operators tweak service plans with new pricing, it's getting harder to figure out how to get the most bang for your buck.

In this week's Ask Maggie column, I try to help readers figure this out. I offer some advice on whether one reader should splurge on the 3G-enabled iPad 2 or save $130 with the Wi-Fi-only iPad 2 and use his iPhone 4 tethering plan. I also help another reader, who damaged her iPhone 3GS, figure out if she should upgrade now or wait for the iPhone 5.

And finally, I offer some insight to another reader on when I think Verizon Wireless will finally start selling its LTE 4G smartphones.

Ask Maggie is a weekly advice column that answers readers' wireless and broadband questions. If you've got a question, please send me an e-mail at maggie dot reardon at cbs dot com. And please put "Ask Maggie" in the subject header.

Wi-Fi-only iPad 2 or Wi-Fi + 3G iPad 2?

Dear Maggie,
Thanks for answering questions about the iPad 2 last week . I held off on the first generation iPad, and although the iPad 2 doesn't have all the improvements I had hoped for, I'm going to take the plunge. Rather than getting a 3G version and separate data plan, I'm considering getting the Wi-Fi only version (saving $130), and using my phone as a hot spot for the iPad when I need 3G access. It seems like the data will be cheaper, at least on Verizon, since the hot spot access will be $20 for 2GB, while the tablet 3G access is $20 for 1GB. What pros and cons do you see with this option?

Thanks,
Mike

Dear Mike,

The short answer to your question is that if you already own an iPhone 4, subscribing to the hot spot feature is more cost-effective than buying a 3G version of the iPad 2.

As you noted in your question, the 3G version of the iPad 2 on both AT&T and Verizon Wireless is $130 more than the Wi-Fi only iPad 2. So this means you'd pay $629 for a 16GB 3G-enabled iPad 2 versus $500 for a 16GB version of the iPad.

Because the price difference between the 3G iPad 2 and Wi-Fi only iPad 2 is so significant, I'd recommend getting the 3G version only if you really think you'll use the 3G service. Neither AT&T nor Verizon requires a contract for the 3G data service. You can activate it and cancel it anytime without a penalty. But it just seems like a lot of money to spend for a feature you might or might not use, especially if you plan to use your iPad mostly at home or in the office where you already have Wi-Fi.

(There was a rumor that AT&T had dropped the pricing of the iPad 2 with 3G by $100, making the difference between the 3G version and the Wi-Fi only version about $30. And that would have definitely changed my advice. But CNET confirmed that the rumor isn't true . AT&T's advertisement was for the original iPad, which Apple had previously announced would be discounted $100.)

Aside from the $130 premium you're paying for the 3G radio in the iPad 2, AT&T and Verizon also aren't making it terribly attractive to subscribe to the iPad data service if you've already got a phone that can create a Wi-Fi hot spot.

In fact, AT&T has made it $5 cheaper a month for customers who already have an AT&T iPhone 4 to use the Wi-Fi hot spot feature to connect their iPad to the Net .

AT&T's tethering fee or hot spot fee is $20 a month in addition to the $25 smartphone data fee. Previously, AT&T limited subscribers to 2GB worth of data for both iPhone data and tethering for the combined price of $45. Recently, AT&T announced that it would increase the capacity to 4GB of data per month for Wi-Fi hot-spot-enabled smartphones.

In short, you can pay $45 a month to connect a Wi-Fi only iPad 2 to the Net via the iPhone hot spot feature and get 4GB of data per month. Or you can pay $50 a month--$25 for 2GB of service for the iPhone 4 and $25 a month for 2GB of service for the iPad 2 with 3G service.

AT&T iPad data plans:

  • 250MB for $15 a month
  • 2GB for $25 a month

AT&T 4G Wi-Fi hot spot:

  • $20 for tethering plus $25 2GB data plan= $50 for 4GB of data

Meanwhile, Verizon is actually giving consumers half as much data per month through its 3G iPad service compared with what it offers customers who subscribe to the iPhone 4 hot spot feature and use that to connect their iPad to the Internet.

Verizon iPad data plans:

  • 1GB for $20 a month
  • 3GB for $35 a month
  • 5GB for $50 a month
  • 10GB for $80 a month

Verizon hot spot service for iPhone 4 and other smartphones:

  • 2GB for $20 a month

Of course, the benefit of having the 3G enabled iPad is that you don't need to have your iPhone with you. And if you're using the 3G-enabled iPad from AT&T, you can take the SIM card out and pop in a SIM card from another GSM carrier to get 3G service when you're traveling overseas. But if ubiquitous network access isn't a priority, I'd stick with the Wi-Fi only version and pay for tethering if you really want the coverage of a cellular network.

Waiting for Verizon's 4G smartphones

Dear Maggie,
I love your coverage of mobile technology and look forward to reading each new installment. I have a question about Verizon and its mythical 4G phones...as in, when are they finally going to be available?! OK, that's probably a bit harsh, but I'm hoping you have some insight. It strikes me as though Verizon blew its 4G launch.

I know why they chose to roll out the network in 2010 (presumably for bragging rights), but did they really gain that much of an edge if they still don't have any phones for the network? Are there really that many people using air cards to currently take advantage of the new network?

I've been due for an upgrade for several months and have been trying to wait for the arrival of the 4G phones, but the lack of news is frustrating and I'm getting antsy. Any word on what has delayed the launch of the 4G phones? Or, better yet, when we'll finally see them? Does any of this have to do with the timing of the Verizon iPhone launch?

Regards,
Nicole

Dear Nicole,
First of all, you make some really good points. AT&T is expected to launch its LTE network this summer. And if it has LTE smartphones when its network launches, Verizon may not have much of a lead.

Unfortunately, I can't give you a specific release date for any of Verizon's 4G smartphones. At the Consumer Electronics Show in January, Verizon said all four phones it introduced would be available by the middle of 2011.

Initially, we expected the HTC Thunderbolt to be available at the end of February or in early March. Many people expected the Samsung SCH-i510 to follow later in March, followed by the LG Revolution in early April. And finally the Droid Bionic from Motorola was expected in early summer, possibly around June.

But it's already the second week of March, and there's still no word from Verizon on the release dates for any of the devices. The company is keeping mum about when to expect these devices or even whether there is an actual delay. But you're not the only one who's wondering where these phones are.

Wall Street analysts are wondering too. Verizon CTO Tony Melone spoke at the Credit Suisse investor conference earlier this week and answered this very question. According to a transcript of the event, he seemed to downplay the delay. He said most experts didn't believe Verizon would be able to deliver LTE handsets in 2011 at all. But he said, Verizon does expect to fulfill its promise to sell LTE handsets by the end of the first half of this year.

"First half of the year is what we promised; first half of the year is still on track. So we don't believe there's any new or surprising issues. I think what we're facing is what you would expect, and that is a new technology. [We] are working through issues. And we anticipated that, and we are pleased at how we are working through issues. And as I said, you are going to see LTE smartphones on the network as promised, before the first half--before the second half of the year, by the end of the second quarter."

Based on his comments, I'd guess Verizon won't introduce these phones until the end of the second quarter, which is the end of June. Also, I doubt that the Verizon iPhone launch has delayed the release of these phones. Given Melone's comments, I suspect that the delay has more to do with making sure the phones and the network are ready.

So in short, I'd look for at least one of these phones--most likely the HTC Thunderbolt--to hit store shelves in June. And hopefully, the other three LTE 4G smartphones that were announced at CES won't be far behind.

To upgrade an iPhone now or wait?

Dear Maggie,
I have a quick question for you on the iPhone. I dropped my iPhone 3GS last night and cracked the screen. I am due for an upgrade, and I was going to just order the iPhone 4, but I wasn't sure if I should hold on and wait until the iPhone 5 comes out. In the meantime, I could just get the 3GS again for $50. What do you think? Have you heard any rumors about when the iPhone 5 will come out, and whether it will be much different from the iPhone 4?

Any insight you have would be great!
Lisa

Dear Lisa,
Based on Apple's history of releasing the iPhone, I'm 99 percent certain there will be a new AT&T model of the iPhone in June. (I'm less certain that Verizon will also get a new iPhone in June or July.)

I can't say for certain what the new features will be. There's a chance that the iPhone 5 won't be too different from the iPhone 4. For example, it may have many of the same bells and whistles, such as a front-facing camera and retina display. But its guts could be different, such as a new network chip that would allow the iPhone 5 to operate over AT&T's faster HSPA+ network instead of its slower 3G network, which is based on an older implementation of HSPA. (AT&T is now calling HSPA+ "4G." I don't think the iPhone 5 will operate over an LTE network.)

Suffice it to say, there will be changes to the next iPhone, and whether those changes are enough to get people to upgrade from the iPhone 4 is really an individual matter.

So what should you do? The way I see it, you have four options:

  1. Apple typically releases a new iPhone every June or early July. So you could muddle through with a cracked screen on your iPhone 3GS for the next few months until the iPhone 5 comes out. In fact, you may even be able to find someone to replace the screen for you for a relatively inexpensive price. It's already mid- March, so you might want to suck it up.
  2. You could use your upgrade and buy a subsidized iPhone 4. This will cost you $200 and it will start the clock ticking on a new contract. But given that Apple products have very strong resale value, you could sell your slightly used iPhone 4 when the new iPhone 5 comes out in a few months. Then you could use the cash to pay the unsubsidized price of the iPhone 5.
  3. You could keep your upgrade and buy a used iPhone 4 or iPhone 3GS. When the iPhone 5 comes out, if you decide you need to have it, you could sell the "temporary" iPhone, and use your AT&T upgrade to get the new iPhone.
  4. And finally, as you suggested in your question, you could get the $49 iPhone 3GS from AT&T. But keep in mind, you only get this fantastic price if you sign a new two-year contract.

I'm not a big fan of this last option, because it locks you into a contract with a phone that is two-generations old. There are a couple of problems with this. For one, you may not be able to use certain applications that require features of later generation products. And second, future iOS upgrades may not be compatible or may even cause problems with the 3GS. So you're better off going with a new product to make sure you can take advantage of all Apple's OS innovations.

If you decide to upgrade to the iPhone 5 in a couple of months, you'll have to pay full price for it. You could try to sell the iPhone 3GS, but this might be tricky given that it will be two generations behind the latest iPhone. So you'd probably be less likely to cover the cost of the full price iPhone 5 by selling the iPhone 3GS.

So the bottom line is this: the iPhone 3GS is a steal at $49, but it may cost you in the long run. So you may want to consider one of the other three options I suggested.

Good luck!

 

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