Walmart's Mobile Service: Do The Numbers Add Up?

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Walmart's Mobile Service: Do The Numbers Add Up?
Walmart can be a great place to stock up on things like laundry detergent and cases of soda. But is it also a place you'll want to go to get voice and data service for your cell phone? The discount retail giant certainly hopes so, as it announced today a new cell phone service called Walmart Family Mobile. The post-paid cellular service offers decent discounts for consumers, but Walmart's new service is not without a few drawbacks.

Walmart Family Mobile is not the discount retailer's first foray into cellular service; it already offers two pre-paid plans. The retailer also sells a variety of cell phones and smartphones, including Apple's iPhone. The Walmart Family Mobile plan is the first to be branded a "Walmart" plan, however. Despite that branding, Walmart is not operating its own cellular network; the plan will operate on T-Mobile's network in the U.S., Walmart says in a statement.

Thinking of making the switch to a Walmart cellular plan? Let's do the math to find out what's good -- and what's not so great -- about Walmart's offering.

PRO: Unlimited Service, Low Prices

Walmart Family Mobile offers unlimited voice minutes and unlimited texting for $45 per month for the first line of service. Additional lines are $25 per month. Those prices are significantly cheaper than what the big nationwide carriers charge for similar plans.

As a point of comparison, AT&T charges $69.99 per month for unlimited calling, and an additional $20 per month for unlimited messaging. That's $89.99 per month -- the same as what Verizon Wireless charges per month for an individual plan that offers unlimited talking and texting.

That's why Walmart Family Mobile can offer "a family of three savings of up to $1,200 per year compared to the national unlimited talk and text plans," Walmart says in a statement.

PRO: No Contract Required

Unlike most "post-paid" cellphone plans -- where you pay for the service after you use it, not before -- Walmart's plan does not require that you commit to a lengthy service contract. In fact, you don't have to commit to a contract at all. If you're leery of signing on for two years of service with a carrier like AT&T or Verizon Wireless, the freedom that Walmart's plan allows will be very appealing. You can cancel your service at any time, with no fear of hefty cancellation fees.

CON: More Expensive Phones

The downside of contract-free cellular service has always been more expensive phones, and it looks like Walmart will be no exception. According to the Wall Street Journal, one of the phones available through Walmart Family Mobile will be the Motorola Cliq XT, which will sell for $249. That's an OK deal when you consider that T-Mobile sells the Cliq XT for $330 when you don't sign a service contract. But if you are willing to commit to a two-year contract with T-Mobile, you can get the Cliq XT for free.

PRO: The Numbers Add Up

But, to get the Cliq XT for free, you need to subscribe to one of T-Mobile's Even More plans, which start at $79.99 per month for an individual plan. That price includes 500 voice minutes, unlimited texting, and unlimited Web use.

If you opt for Walmart Family Mobile, you'll pay $45 per month for your first line of service. As previously mentioned, that price includes unlimited voice minutes and unlimited texting, so the plan offers more than T-Mobile's in that regard. But Walmart's plan does not include any data coverage, which you'll need for surfing the Web or downloading apps.

CON: No Unlimited Data

So, how much will data cost you on Walmart's Family Mobile plan? Data will be sold in buckets, which never expire and can be shared across all users on the same family plan, Walmart says. Each activated account will come with 100MB of free data; after that you can purchase data upfront in WebPaks, which are refill cards. A WebPak with 200MB of data will cost $10, 500MB will cost $25, and 1GB for $40.

PRO: Cheaper Data Service

While it's convenient to have a plan that offers unlimited data, it's not always the cheapest option. I took a look at my own data usage to see how Walmart's plan would work out for me. I use an iPhone 4 and consider myself a moderate consumer of data -- I certainly don't shy away from using any apps over AT&T's 3G network. In the past six months, I've never exceeded 160MB of data per month -- and most months, I've been well under that amount. That means, if I were to use Walmart's service, I could purchase 500MB of data for $25, and it would last more than three months. That's less than $10 a month.

UNKNOWN: Phone Selection

Walmart's statement announcing the new service notes that the lack of a contract means that users can upgrade their phone anytime they'd like. It also says that the service will offer phones from Samsung, Motorola and Nokia, "including phones with the Android Operating System, QWERTY keyboard, touch screens and other features."

What Walmart does not specify is how many phones it will offer and how much each of them will cost. We'll have to wait until the service officially launches later this month to find out.

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