I bought a hybrid and it costs $20 a month

by karlhenk

Detroit — Nineteen dollars is enough for a meal and dessert at Bennigan’s, a nosebleed seat at a sporting event and, presently, about a third of a tank of gas.

But in no way can $19 buy you a cell phone plan with talk, text and data, right?

Wrong.

Republic Wireless, a division of telecom company Bandwidth.com, has brought to market an Android-powered Motorola phone with unlimited features for just $19 a month.

That’s the price, now here’s the catch: The phone, a DEFY XT, uses a hybrid technology to place phone calls and surf the web. When in range of Wi-Fi, the phone uses Wi-Fi; when Wi-Fi is unavailable, Sprint’s 3G network kicks into gear.

It’s an imperfect system (calls can drop if a customer leaves a Wi-Fi zone), but it’s a system I’m willing to gamble on.

But after spending $100 a month for the the past 23 months as a Verizon Wireless customer, I didn’t hesitate to cut my phone budget by 80 percent — without committing to a two-year contract mandated by other phone providers — and switch to one of Republic’s plans.

My choice was a $249 phone that runs outdated Android software, followed by monthly payments of $19. Republic recently added a second package, where consumers can buy the same phone for $99 and pay $29 per month. (Note: Though less money up front, after 16 months of the $29 plan, it becomes the more expensive of the two.)

The Raleigh, N.C.-based company also plans to offer additional phones later this summer.

Changing industry

Wireless billing analysis firm Validas says that 80 percent of wireless subscribers overpay for their mobile services, despite analyst projections that 80 percent of cell phone users qualify for discounts through multi-phone or business plans.

The Motorola DEFY XT is currently the only phone for Republic Wireless plans.

Smartphone use is projected to top 1 billion by 2015. Wi-Fi use will also increase, and the Federal Communications Commission has responded to the need for additional Wi-Fi frequencies by announcing plans to open up a previously restricted frequency spectra.

The growing Wi-Fi demand is partly a result of wireless companies “throttling back,” or slowing the speed, of cell-phone data packages. Gone too are the days of widespread unlimited data packages. Verizon and AT&T have previously halted unlimited data plans.

The solution is more Wi-Fi. Republic’s customer base currently uses Wi-Fi — as opposed to Sprint’s 3G network — more than 60 percent of the time, said David Morken, co-founder and chief executive of Bandwidth, in a recent interview with the New York Times.

A grand experiment

My current Verizon plan includes 450 minutes and unlimited text messaging and data. I’ve never exceeded my allotted minutes and surf the web primarily using Wi-Fi.

That puts me in the minority of most cell phone users.

The DEFY XT is no iPhone 5. Hell, it’s probably not even on par with an iPhone 3. But as long as I can send messages, tweet and ask Google the occasional trivia question, it will suffice, especially if I save nearly $1,700 compared to my current Verizon plan.

And if it doesn’t, I’ll sulk back to Verizon, spend a few hundred dollars on a snazzy new smartphone and continue to burn through Benjamin Franklins each month.

You know, just like everyone else.

Follow Karl Henkel on Twitter, friend him on Facebook.

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