Understanding Mobile Phone Plans

To understand mobile phone plans, you have to look at two pieces of the puzzle, the company that provides the mobile phone service and the plans they provide.

The Companies That Provide Service

Major Wireless Carriers

In the United States, there are three major wireless carriers: Verizon, AT&T, and T-Mobile. They build and maintain the physical infrastructure, including cell towers and network equipment, which allows them to offer mobile phone service across the country. They also operate networks of stores that are available in most major metropolitan area and have outlets in other large consumer big box stores. Because they invest heavily in infrastructure, they can offer their customers the best possible mobile phone service.

Mobile Virtual Network Operators

There is also a growing trend of mobile carriers called Mobile Virtual Network Operators (MVNOs), who don’t own their own network infrastructure.  Instead, they lease access from the major wireless carriers and resell it under their own brand. These include Mint Mobile, Visible, US Mobile, Xfinity Mobile, and Consumer Cellular.

MVNOs often target niche markets—such as budget-conscious users, older adults, or international travelers—and offer more flexible, lower-cost plans. However, because they operate on borrowed networks, MVNO customers may experience several drawbacks.

-Slower data speeds.  Sometimes your internet might be slower when lots of people are using it at the same time (aka network congestion), like in areas where lots of people are using it at the same time, like at a sporting event, an airport, or in a crowded city.

-Lower priority.  Since MVNO’s are on borrowed networks, the main carrier’s customers come first.  If you’re standing next to a friend with major carrier service and you have an MVNO, you might not be able to watch a video, and they might be able to, even in a crowded area. It’s similar to data speeds, but sometimes it’s just the ability, especially in crowded areas, to actually do anything but call or text.

-Less customer service and no retail presence. Major carriers usually have physical stores and extensive support teams so you can walk in and ask someone for help. With MVNOs you usually have to go online, which might make getting help harder.

THE PLANS

In the past, plans were sold based on minutes on the phone, text messages sent, and amount of data used. Today, mobile phone plans mainly focus on data used as a metric for what is charged.

Several carriers offer a pay by the gig plan, which allows you to pay for your service as you go, based on the amount of data your phone uses during a billing period. Depending on what you use your smartphone for, this can be a great option for a budget phone service, however if you exceed your monthly allotment, your costs can quickly balloon.

The majority of phone plans offer some sort of unlimited plan. Prices vary based on the number of lines you have, the amount of high speed data you are allotted on a monthly basis, additional perks like streaming services bundled into your plans or other factors like, smartwatch add-ons, personal hotspot data, steaming video quality, international calling/texting. Finding a plan that’s right for you would consist of finding a carrier that includes a plan of the features that you use the most.

…And of Course, the Phone

Both major phone carriers and MVNOs offer incentives for upgrading phones or buying new phones. These typically end up as a statement credit spread over a certain number of months, keeping you using that particular carrier for an extended period of time. Taking advantage of these savings is a great way to save money on a new phone. Carriers also tend to offer new or existing customers deals on trading in their phones when they upgrade their current phone to a new one.

Just a friendly reminder, you can transfer your number to any carrier at any time. But also remember it is recommended to secure your number with two-factor authentication or other measures to maintain control over it. That’s it for this month, don’t forget to come back next month when we’ll look at the top 10 most popular tech products of 2025.

YOUR TURN

When is the last time you looked over your phone bill? Have you ever thought about switching to a new phone carrier? What stopped you from making the switch?  We want to hear from you!

Jeff Rose is the Director of Special Initiatives at Older Adults Technology Services (OATS) from AARP. He has been at the forefront of the intersection between aging and technology for more than 15 years in a range of settings, including life-plan communities, community-based organizations, and an age-tech startup. Based in Chicago, Jeff is active in a variety of local aging and community organizations and enjoys sharing his knowledge about how technology can impact and benefit older adults.

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