Are You Paying Too Much For Your Phone? If You Live in America, the Answer Might Surprise You

Even cats use phones

. The cellphone is one of the most vital and innovative pieces of technology to ever be invented. It allows people to contact one another across the world, pay for goods, get directions, shop, and do business, all on one small device. For most of us, we have our cellphone’s glue to our hands (people have even developed tools to assist in making the holding of phones less challenging). I got my first real cellphone at sixteen, in China, it was a red flip phone and I loved it to bits. Since that time, I’ve never not owned a cellphone. But unlike many people, I was behind the phone curve.

It is undeniable that cellphones are now an indispensable part of modern life. We can capture every special moment because our phones have camera’s. Entrepreneurs can run a business entirely from their phone. People have made fortunes off of just developing phones apps. Most households in the UK and USA don’t even possess a landline. We just depend on our phones.

Why then, are cellphones and phone plans still so expensive? The technology is all over the globe to support texting, phone calls and data service, it no longer needs to be an exclusive club. But nonetheless, it can still be unaffordable for a lot of people. Some might own the physical phone, but can’t afford to connect it to any sort of phone plan, and are forced to rely on wifi which can be spotty at best. The new version of the IPhone or Samsung Galaxy can cost $1000/£900. The cheapest smart phone (new) is around $100/£90. My Samsung S4 mini (two years ago) cost me $160/£150 (and it was outdated even then). While cellphone’s might be a modern necessity, they are not economical.

How do people cope with the high cost? They get phone plans with a big company, where they pay for the cost of the phone every month, as well as the cost of the use of the phone. A typical phone contract lasts from 1-2 years, and it costs a fortune to end the contract early in America (we are talking hundreds of dollars). It can take people 2 years to pay off the cost of their phone, and at the end of 2 years most phone companies suggest you get a new version, and the cycle starts again.

I choose to always buy my phone outright, and then only pay a month to month usage fee to O2 (a big phone provider in the UK). My phone cost my $160/£140 outright, and I now pay $20/£18 a month for 10 GB of data and unlimited calls+texts. The most I have heard of someone paying in the UK for a phone+ phone use plan per month is roughly $50/£45. The cheapest I’ve seen is around $6. The physical cost of a smartphone in the UK is still high, but operating it is very affordable. In fact, this year legislation passed that required all UK phone companies to stop charging customers for texts or phone calls made in the EU. How awesome is that?! The UK has made having a mobile phone (their words, not mine) not a luxury, but an affordable, inexpensive necessity.

In America, I would $30/£25 a month, for a basic pay as you go plan that had a minuscule amount of data. A friend of mine told me he pays around $60/£55 a month for his plan. I’ve heard of people paying upwards of $150/£145 for an individual plan. The costs can go even higher if you have a data limit that you exceed. Why is America so different from the UK in cellphone costs? One possibility is the sheer size of the USA requires that operating phone’s costs more to cover the whole country. Another reason could be that in the UK there is more competitors on the marketplace, so they try and price one another down. In America, there is about 3 major phone companies that everyone must sign with in order to get decent coverage.

America has gotten many things right. I believe that my homeland has better food, friendlier people, better roads, but we do not have a better cellphone system. The fact is, owning and using an IPhone is cheaper in England. One solution that could be taken is for the US government to intervene and make regulations for cellphone companies that stop them constantly raising rates. The UK government is much more active in their citizens lives (that is partially due to the EU) and it benefits the people more. But, that is a subject for another post. For now, all my American readers, know that you are being robbed by your phone company. Next time they offer you an upgrade, refuse and say that in the UK it’s way cheaper to have unlimited data and calling!