Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

2013 04 19 00.00.58   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save HundredsDid you know it’s much cheaper to buy your phone independent of a carrier? The big cell companies sell phones at a tremendous markup, disguising their overpricing through subterfuge: The true price of the phone gets rolled into the monthly cellular bill.

Never buy a smartphone from a carrier—ever. Most consumers don’t know that they can purchase their phones from retailers and pay less than if they did from the carrier. The key word that you’re looking for is unlocked. Unlocked phones can work with MVNO plans, which offer the same service as the big carriers for about half as much.

The six phones presented in this article provide excellent value, with prices starting at $120 and going as high as $650. However, if you are looking to sign a contract with a carrier (and I strongly suggest that you do not), check out Matt Smith’s list of the best phones you can buy right now—he’s absolutely correct. However, if you need reasons to dump your carrier and hook up with an MVNO, read about it here.

Two Kinds of Phones

As I’ve mentioned before, there exist two kinds of unlocked phones—those that work with GSM networks, those that work with CDMA. I should note at this point that other technologies exist, but they’re not entirely mainstream and largely based on the ubiquitous GSM standard.

CDMA: CDMA technology semi-locks phones into a single network, so while these phones can unlock, there’s all kinds of associated hassles in transferring them from one carrier to another. For GSM phones, however, phones can migrate to another network by simply changing the SIM card. CDMA technology in comparison does not use any kind of card.

  • In the US: Verizon Wireless, Sprint Nextel, MetroPCS and US Cellular.
  • In Japan: DoCoMo.

GSM: Internationally, GSM remains the dominant cell technology. CDMA does exist in almost all markets, although it’s generally associated with third tier carriers. It’s only in the US that it possesses the lion’s share of the market. Consequently, most dual-SIM international phones are GSM based.

  • In the US: T-Mobile and AT&T.
  • In India: Airtel, Reliance Communications and Idea Cellular
  • In the United Kingdom: O2, EE andVodafone

The phones presented in this article are specifically labeled with the correct network that they function on. When purchasing a phone, always make sure you’re buying the right model for your network. If you’re switching to an MVNO, the MVNO will correspond with a particular network—for example, Ptel (which rents spectrum from T-Mobile) only works with GSM phones, both AT&T and T-Mobile. I explain in detail in this article.

Criteria

I use three factors in determining the phone’s final grade: First, the best features of the phone are weighed. Second, the worst features of the phone are weighed. Third, I divide the price of the device by the aggregated consumer feedback scores from Amazon, Newegg or other smartphone review websites (whichever was available). The final result shows how much you pay per star of rating. This measure isn’t intended as a serious metric, although it should indicate better overall value, rather than raw performance.

BLU Dash 4.0 ($119.46 via Amazon)

BLU Product’s Dash 4.0 is the cheapest Android 4.0 smartphone you can buy unlocked, anywhere. While the manufacturer is a newcomer, their products have been getting solid reviews. And they’re also the only manufacturer that specializes in unlocked cell phones.

Networks: GSM

Pros:

  • The lowest priced, unlocked Android phone with Ice Cream Sandwich.
  • Dual SIM for international travelers.
  • Good value for its performance and features.
  • Great value and lowest total price for a brand-new phone.

Cons:

  • This phone may not receive an update to JellyBean.
  • No root access or custom ROM community.

Per star rating: $119.46/3.8 stars = $31 per star.

BLU dash 4   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

Apple iPhone 3G 8GB ($174.94 via Amazon)

Apple’s iPhone 3G still works great, even though it’s aging. If you’re locked into the iOS app environment, the 3G provides the cheapest entry point for a mobile device that’s still functionally modern. Also, for refurbished phones, consider purchasing an after-market replacement plan.

Networks: GSM

Pros:

  • The cheapest entry point for iOS.
  • Inexpensive replacement parts.
  • Inexpensive cases and peripheral devices on secondary markets.

Cons:

  • Old: The iPhone 3G is already several years old.
  • Poor value: For what you pay, this is a very poor deal.
  • Refurbished.
  • No iOS 6: While a jailbroken 3G in theory might take iOS 6, the performance would likely be terrible.

Per star rating: $174.94 / 2.8 stars = $62.48 per star

HTC Nexus One ($155 via Amazon.com)

HTC built the first phone in the Nexus series. While the phone’s single core CPU is starting to feel its age, it retains one of the strongest followings within the Android development community. Also, for refurbished phones, consider purchasing an after-market replacement plan.

Networks: GSM

Pros:

  • Strong custom ROM support and easy to root—support for JellyBean!
  • Inexpensive replacement parts.
  • Inexpensive cases and peripheral devices on secondary markets.

Cons:

  • Old: The 1GHz single core CPU
  • No warranty.
  • Refurbished.

Per star rating: $155 / 3.7 stars = $41.90 per star.

BLU Vivo 4.3 ($188.99 via Expansys)

BLU Products manufactures a range of low-cost Android smartphones. Although an relative unknown in the US, it provides some of the best deals on an unlocked phone around. Additionally, it recently committed to upgrading the Vivo 4.3 to JellyBean. As a result, the Vivo provides a great deal to those who want a good performing phone, without the potential for modifying the ROM.

Networks: GSM

Pros:

  • OS Upgrade forthcoming: JellyBean (Android 4.1)
  • Decent quality camera.
  • Pentaband (high compatibility with GSM networks) and dual-SIM.

Cons:

  • Development support for unlocked phones unlikely.
  • Dual core processor not comparable to cutting edge smartphones.
  • Lack of LTE.
  • Not rootable and no custom ROM community.

Per star rating: $188.99 / 4.2 stars = $45 per star.

BLU VIVO   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

LG Nexus 4 (8GB $299, 16GB $349)

The Nexus 4 is part of Google’s Nexus program, where Google picks the parts and the manufacturer produces it. The Nexus series remains one of the best performing phones on the market. As an added bonus, these phones are highly prized because they can easily be rooted and modified with a custom ROM. Full disclosure: I own a LG Nexus 4 and love it more than my own family.

Networks: GSM, rumors of a Sprint and Verizon CDMA model on the horizon.

Pros:

  • Best valued smartphone in terms of cost-to-performance.
  • Great custom ROM support and easy to root.
  • High quality construction.
  • Good camera.

Cons:

  • No microSD support.
  • No official LTE support.
  • Partially sealed in battery: The Nexus 4 battery isn’t entirely user replaceable. Removing the battery requires a Torqx screwdriver and a hairdryer or heat-gun.
  • Fragile: The glass back shatters easily.

Per star rating: $299 / 4.5 stars = $66 per star and $349 / 4.5 stars = $77 per star.

nexus 4   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

Samsung Galaxy S3 ($439.95)

Samsung, recently scandalized by possible phony HTC reviews, currently dominates the smartphone market. Their flagship phone, the S3, comes well regarded and is compatible on all major networks in the US. However, the GSM version works great internationally.

Networks: GSM, Verizon-CDMA, Sprint-CDMA

Pros:

  • Remains one of the fastest handsets around.
  • Android 4.0 (ICS).
  • Large Super AMOLED screen at 4.8″.
  • Good community support for rooting and installing custom ROMs.

Cons:

  • Soon to be replaced by the Galaxy S4.
  • Samsung does not update their phone’s operating systems.
  • International edition doesn’t have LTE, although it does have a quad core CPU.

Per star rating: $439.95 / 4 stars = $110 per star.

galaxy S III   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

iPhone 5 ($650 via Apple Store)

The most ubiquitous brand in this article, Apple created the smartphone market.

Networks: GSM (requires contract for Verizon-CDMA and Sprint-CDMA)

Pros:

  • Latest, state-of-the-art product from Apple.
  • Cutting edge features.
  • iOS, if you are locked into the Apple app ecosystem.

Cons:

  • Most expensive phone you can buy.
  • Small screen, although high quality Retina display.

Per star rating: $650/3.7 stars = $175 per star.

Conclusion

If you’re looking for an unlocked cell phone with good value, BLU Products Dash 4.0 or the BLU Vivo 4.3 provide the best products on the market. Unfortunately, because of the relative obscurity of their manufacturer, few reviewers have given credit to otherwise value-packed phones.

2013 04 22 15h53 26   Never Buy a Phone From Your Carrier! Buy Unlocked Phones and Save Hundreds

On the other hand, the best reviewed, unlocked cell phone on the market is the Nexus 4. Personally, if I weren’t so obsessed with custom ROMs, I would have preferred the Dash or the Vivo over my Nexus. Combined with the right plan from an MVNO, you can save hundreds of dollars a year and still have a great phone.

Anyone own a BLU phone? Or does anyone else prefer MVNOs/prepaid plans? Let us know in the comments.

Image Credits: Piggy Bank via MorgueFile.com; cell phones via manufacturer websites.

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27 Comments -

2 votes

Tim Brookes

So wait, I’m confused – where did the star ratings come from? Are they aggregated?

1 votes

Kannon Yamada

I stole ratings from other websites basically. Mostly from Amazon, but on some other phones (that didn’t make it into this review), I took ratings from Newegg and BestBuy. “Aggregated” was a poor choice of words – I was referring to a compilation of stars from an individual site for a particular model of phone.

I plan on recompiling these numbers in a future review to aggregate all reviews from most major retailers. There’s some major unlocked handset manufacturers coming out with new phones in the near future, such as cheap quad cores from BLU and an entirely new manufacturer is entering the market.

0 votes

macwitty

I think it depends on the country you live in. Still often cheaper from carrier in you live Sweden and most of the time you can get it unlocked very soon

0 votes

erik

I understand how the price of the phone is subsidized by the phone plan. But how does buying an unlocked phone save you any money? You still need a carrier plan with minutes and data correct? And the carriers dont reduce the cost of your phone plan if you use your own phone. Do they? If they did, I could see how you could save money but I dont believe this is the case. Am I wrong? The way I see it is if you buy a subsidized phone thru the carrier, you save upfront cost and you pay the same carrier rates regardless. What am i missing?

1 votes

Kannon Yamada

That’s an excellent question – you can buy cell service from companies that lease spectrum from the big carriers. These companies are called MVNOs. They resell to the consumer at a much cheaper rate. There’s plans where you get unlimited text, minutes and data for $45 (or less) a month.

I wrote about how to switch over to an MVNO. It’s simple, get a GSM phone and then you buy a prepaid SIM card, which goes in the phone.

T-Mobile actually just started offering competitive prepaid plans, although it’s a little hard to find those prepaid SIMs.

1 votes

Kannon Yamada

Oops, I should have elaborated a bit more.

So here’s what you pay under a 24 month contract:

$200 up front for the phone.

$80 a month each month + taxes.

$200 + $80 * 24 = $2120 for the first two years.

The best prepaid MVNO plan, in terms of call quality, price and simplicity, is Straight Talk’s $45 (or as low as $41.50 for one-year prepay) plan. Here’s what two years + a Nexus 4 would cost you:

$300 + $45 * 24 = $1430 for two years but you can leave at any time.

That’s a difference of $690.

However, you can get even CHEAPER plans. For example, if you have a $19 a month, limited minute plan from Ultra.me and just swap your SIM into a phone you already have, that’s $456 dollars, a difference of $1664. If you bought a Nexus 4, you’d save $1,3064.

And the ultimate in cheap plans – pay-go from Ptel.com – cost around $5 a month. This particular plan is for folks who rarely use their phones. But a two-year prepaid plan would cost you around $120, which provides savings of $2,000 relative to a plan from a carrier. Or, if you bought a Nexus 4, $1,700.

I think that worst thing about carriers is that they continue to charge the subsidized price, even after your contact with them expires. So if you remain on the same plan for four years, you’re paying thousands more than had you gone with an MVNO.

0 votes

Danny

I agree with Erik 100%. There is no way you can save any money by using an unlocked phone.

1 votes

Kannon Yamada

It’s all in the math, Danny. If you have time, Read my article on MVNOs, which are companies that lease broadcast spectrum from major cellular networks. If you don’t have time, here’s why – you can get the same service for half the price from an MVNO. You only have to buy the phone and the plan.

You can even buy the phone and the plan directly from the MVNO, although they will mark the phone up slightly.

I realize why most people would be skeptical. That’s because the carriers spent a lot on convincing us that a smartphone contract costs a minimum of $80 a month and comes with a legally binding contract.

Does that make sense? I can see why a loan might be legally binding, but buying a cell phone shouldn’t require anything more special than buying a candy bar or wristwatch.

0 votes

Onaje Asheber

Nice!

1 votes

Keith S

Kannon, you have done all of us who use cellphones a GREAT service! I admit that when it comes to anything but using a cellphone, I am DUMB! Thank you so very much! This is an invaluable guide.

0 votes
0 votes

Martin Turner

G’day guys,
I’m in Australia, and we call cells, ‘mobiles’.
Anyway, I have a plan with Virgin Mobile which is an MVNO, and I pay $39/month which includes a Sony Xperia acro S and you get, $450 calls & text, 1GB monthly data allowance, Unlimited mobile calls & text Virgin to Virgin, Rollover your unused plan credit, Free Voicemail in Oz, International calls & text included.
And if you have your own phone it’s $10 off, i.e. $29/month. Good one Kannon.
Cheers boys.

0 votes

Kannon Yamada

Thanks for sharing Martin! That’s a pretty good plan.

Rollover is something that few limited plans in the US offer. I think Ting in the US and Canada offers something similar to rollover, where discounts get applied for not fully using allocated minutes/SMS/data. Getting a discount for bringing an unlocked phone is super unusual. What’s really unusual is that V-Mo in the US has purely locked phones – you cannot take a phone off their network or put an unlocked one on. But V-Mo’s plans over here are among the best.

0 votes

Brian

I don’t see how unlocked phone would save my family money.

My parents both use feature phone, both would require unlimited talk (dad used 2361 minutes last month), and neither uses texting. My brother and I use smartphones; I used around 300 minutes while my brother used around 100. Neither of us texts, and we barely use data.

Currently, the bill is around $115 to 116 a month (if we stick with ATT after our contract is up, this will be bumped up $10 a month due to data plan changes). My brother’s phone was around $60, my dad’s was around $30, and mine and my mom’s were a penny each (all of this after taxes). In this scenario, this rounds out to around $30 a month over the course of two years for each person in my family.

0 votes

Kannon Yamada

Hey Brian, thanks for the comment – this is an important point to address.

MVNO’s also offer family plans, which are sometimes still cheaper than the family plans offered by big name carriers, depending on the network you’re on. H2O, Cricket and Net10 all offer such plans, but I don’t know if they’re any better than what your family currently uses. I suspect that such plans are designed to get you on overage charges, though, since they oftentimes use a pool of minutes, data and SMS.

I do know that individual plans including limited (or unlimited) SMS and data and unlimited talk time exist and for less than $30.

http://www.prepaidphonenews.com/2011/02/best-prepaid-voice-plans.html

So you could still save money, but unfortunately, the cheapest plans for unlimited talk are on the Sprint network. Sprint phones use CDMA technology, which makes transferring your phones across networks difficult. So depending on whether your phone is CDMA or GSM would determine whether you could take your phone with you.

I think the best way of going about this would be to sit down with your family and discuss your options – which plans and MVNOs (or carriers) might save the most amount, while providing a service compatible with your needs. The bottom line, however, is that signing a contract is not worth it. You will ALWAYS save money by not signing a contract.

0 votes

Brian

I will have to check out those companies then; I’ve heard of them all before.

If I want to get a new unlocked phone with those plans every two years or so, it will most definitely be above $30 a month unless I wait a while and/or I get lucky on ebay/Craigslist.

Sprint is the only major network I have not really considered. I would like a high-end WP8 phone as my next phone, and they do not have one at the moment. From what I have heard, the two that they will be getting will be mid-ranged ones. I think my wants severely limit my choices.

I really do want to be free of contracts, but at this point, it does seem like one of the cheapest and lowest-hassle options available to me and my family.

0 votes

David

Personally I have a Jiayu G2S and found it very good. Apart the GPS which can’t really pick up signal. but it’s fast and reliable.

0 votes

Kannon Yamada

Wow, that’s a really nice phone! Jiayu does not manufacture phones in the United States, unfortunately, but something about carrying around a steel frame, high rigidity phone is really appealing.

There’s a fix for your GPS problem. It requires rooting and installing a custom ROM, but it makes the GPS useful. On the downside, an improperly done root will break your phone. :-(

And if the ROM isn’t exactly right, it will brick your phone. Lots of pitfalls here.

There’s some discussion about rooting here.

And here.

Thanks for sharing!

0 votes

Wejustunlock

You can buy a locked phone and get it unlocked , it will be more cheaper

0 votes
1 votes

wyguy

while going with straight talk or others might save some people money it doesn’t always work that way. for instance I can currently get Samsung galaxy s3 from Verizon for free if you order online and talk to the right people. cost for 3 phones under my current contract $180 brings the cost to 4320 for 24 months. Straight talk is $135 for 3 phones/ last time I looked anyway, $3240 saving $1080 over the 25 month period but it cost $428 each for the phones if you buy a new one unlocked, at $1284, costing me and extra $204 to use straight talk and have the hassle of getting dropped all the time as the cell towers get busy. Been there done that.

0 votes

Kannon Yamada

Call quality is an issue with any company reliant on the T-Mobile networks (and Sprint/AT&T to some extent). They generally have poorer call quality and their broadcast spectrum compares poorly to Verizon in terms of wall penetration. Wall penetration tends to be the greatest cause of call quality issues (with network traffic coming up pretty high, too).

There are actually Verizon and Sprint based MVNOs, though, such as Ting.com and PagePlus Wireless.

In your particular case, I would suggest trying out one of these alternative carriers, such as PagePlus Wireless (Verizon). They offer low prices and high quality. Unfortunately, because their cellular technology is CDMA, you can’t migrate phones across networks with much success.

I’m curious – this is for a family plan, right? MVNOs offer more than just unlimited plans – you can get limited and pay-go plans that customize to fit your needs. I rarely use my phone and consequently pay about $5 a month for the few things I do use it for. If you go by average usage, most people are in the same boat: They should be paying about $20 a month for their phone. The unlimited plans are easy to suggest to someone coming from a big carrier because they’re universally cheaper, even to heavy users.

0 votes

Honeyeleven H

the post is great ,and i agree with it ,if you would like more phones or cards ,you could go to MoonarStore have a look ,great

1 votes

Peter Koncz

Hi, I have a question. I am from Hungary.
My daughter is in Bruce, WI, for 11 months. The only good network there is Verizon. She needs a smartphone that works both CDMA and GSM. Is that possible at all in one physical phone (like Samsun Galaxy S3) or not? Does BLU has such phone?

1 votes

Kannon Y

I only know of two phones that work on both CDMA and GSM networks – The developer version of the Moto X and the iPhone 4S (and I think the iPhone 4).

There are a handful of others, but these are the two best known. Unfortunately, you cannot simply move such a phone from a CDMA network to a GSM network. The CDMA network requires that they “flash” the phone with their own software. You must speak with a representative with Verizon in order to transfer the phone over. They might not even allow such phones on their network, for whatever reason.

It’s actually illegal for Verizon to disallow CDMA devices on their network, yet they do it anyway.

0 votes

Bing

What are options for cdma phones? i have an evo htc. It is out of contract.

0 votes

Kannon Y

If it’s a Sprint CDMA phone, I believe you must first request that the carrier unlock the phone before moving it. Last I checked, their official policy was to unlock phones once the terms of the contract have been fulfilled. But Sprint may have additional steps required of you to unlock the device – I’m not sure if they can remotely unlock the device with the MSL code. But in short, contact Sprint and ask them to unlock the phone.

After that you will need to contact a Sprint-network MVNO that permits BYOSD (bring your own Sprint device, sometimes referred to as BYOD). For this purpose, Ting.com is one of the best. There’s a few other Sprint-MVNOs that also permit this, like PrePayd Wireless.