Abstract photo representing wireless technology

Variable-Rate Pricing, Network Switching, and Mobile X

Urban planners have a joke: “You aren’t in traffic; you are traffic.”

While most people consider how long they’d have to wait in traffic if they travel, almost no one thinks about how much worse they’d make traffic for everyone else.

Conventional tolls charge road users the same rates all the time. Variable-rate tolling is a clever alternative. Under that approach, people pay high tolls when roads are congested. Tolls are low (or non-existent) when roads are wide open. When managed well, variable-rate tolling can lead to huge improvements in efficiency.

Conventional cellular pricing is inefficient

Most of the time, cell phone networks are not at their max capacities. In these situations, a mobile subscriber can use data without degrading service quality for other users on the network or incurring substantial costs for the network operator. On the other hand, network capacity is a precious resource when networks are congested.

With conventional wireless price structures, a gigabyte of data use costs a subscriber the same amount regardless of how congested a network is. There’s a sense in which it would be way more efficient to vary the cost subscribers pay for a gigabyte based on how congested a network is.

With variable-rate pricing, people with money to burn and a need for high-performance could get great speeds all the time. Budget-sensitive consumers could get super cheap data most of the time, then reduce data use when bandwidth is in high demand.

Network switching

If a small town could have its entire population covered by one cell tower, multiple networks may still build towers. In some sense, this is horribly inefficient. On the other hand, it’s unsurprising given the structure of the wireless industry in the U.S. While roaming agreements allowing subscribers to use other carriers’ towers do a lot to reduce inefficiencies like these, the situation is far from optimal. Mobile phone subscribers are at the whims of whatever roaming agreements are in place between network operators.

Imagine an individual T-Mobile subscriber is out of the range of T-Mobile’s network and near another network’s tower. What if the subscriber could pay for temporary coverage from the tower? It’s not an option today, but there’s no technical obstacle making it impossible.

Google Fi uses a form of dynamic network switching that has huge benefits. While Google Fi typically uses T-Mobile’s network, Fi subscribers are automatically switched to Sprint or U.S. Cellular when those networks can deliver better performance.1 Currently, only a tiny portion of U.S. consumers have access to this kind of network switching.

If more carriers embrace dynamic network switching, consumers will benefit. If dynamic network switching is combined with variable-rate pricing, consumers will benefit enormously.

Mobile X

Yesterday, Peter Adderton, the founder of Boost Mobile, began to tweet teasing a new carrier he’s working on called Mobile X:

While the first tweet was vague, it seemed to hint at some of the unconventional features I’d like to see. Today, Adderton shared a more promising tweet:

The image is the part I find most interesting. While I don’t know what Adderton is building, the mockup interface sure looks like it fits with a service that involves both dynamic network switching and user-selected levels of service quality.

Boost Mobile Launches Its Own $15 Plan

Earlier today, Boost Mobile, a flanker brand of Sprint, followed in the footsteps of many other wireless carriers and announced its own $15 per month plan that includes unlimited talk and text along with 2GB of data each month.

Boost made it clear that this is a short-term deal. Customers who take advantage of the promotion will see their monthly bill double after the first two months of service. Here’s a bit from today’s press release:

This limited-time offer, which also includes taxes and fees, mobile hotspot and 99% nationwide coverage with voice roaming, is available through May 12. After 60 days, the monthly plan moves to $30/month.

We now have several carriers offering a $15 per month plan with unlimited minutes, unlimited texts, and 2GB of data:

  • T-Mobile
  • Metro
  • AT&T
  • Cricket
  • Boost Mobile

In my opinion, the Boost Mobile offer is the least attractive among these plans since it combines both Sprint’s lackluster coverage and a promotional price that only applies for two months.1

Virgin Mobile USA Is Shutting Down: Subscribers To Be Transferred To Boost Mobile

Virgin Mobile USA, a flanker brand owned by Sprint, is shutting down. Today, reports surfaced from many Virgin Mobile customers who received texts that started like this:

Virgin Mobile USA is discontinuing and your account will auto-transfer to Boost Mobile.

Boost Mobile is another flanker brand owned by Sprint, and it should offer almost all customers service that is quite similar to the service Virgin Mobile USA has been offering.

Interestingly, I can’t find a press release from Virgin Mobile about the shutdown. However, the company has published a web page with an FAQ about the upcoming changes. The page illuminates several details about how the automated transfer of subscribers from Virgin to Boost will be handled:

  • Subscribers will keep their existing phone numbers.
  • Subscribers should be able to keep their current phones.
  • The transfers will begin in February.
  • Boost Mobile will not accept Paypal. Subscribers that paid for Virgin service with PayPal will need to choose a new payment method.
  • Payment dates will usually be unaffected by the transfer from Virgin to Boost.
  • Subscribers automatically paying for Virgin service via credit card or debit card will have their payment methods transferred automatically.
  • Device insurance purchased from Virgin should carry over to Boost.
  • Devices using Virgin’s Mobile Broadband service will not automatically be transferred to Boost. Subscribers using these devices will need to find new carriers.1

Virgin Mobile USA suggests that most subscribers will receive pricing with Boost that is the same or better than existing pricing with Virgin:

In most instances, your existing account will be transferred to Boost Mobile with your device, and a comparable or better Boost Mobile service plan at no extra cost to you… In fact, since Boost Mobile accounts have taxes and fees included, customers will end up paying less than you do now on similar plans.

While Virgin Mobile USA is suggesting customers will not face increased prices, I suggest that subscribers pay attention to any changes in their bills and plans over time. While I expect most subscribers will not be affected adversely in the short-term, it doesn’t look like Boost has committed not to raising prices or forcing plan changes in the future. I’d be especially vigilant if you currently have a grandfathered plan that Virgin no longer offers to new customers.

In most cases, I think Virgin subscribers should anticipate a smooth transition to Boost. Still, the transition may present a good moment for subscribers to consider other options on the market. Mint Mobile, a relatively new, low-cost carrier, may offer many people better coverage and lower prices than Virgin or Boost.

Why is Virgin Mobile USA shutting down?

On the FAQ page about Virgin’s shut down, one of the questions listed is: “I have been a Virgin Mobile customer for a long time, why is my account being transferred to Boost Mobile?” Virgin responds to the question with a non-answer:

We appreciate your loyalty. To ensure that we offer the best service to our customers, we regularly examine our plans. At this time a decision to discontinue the Virgin Mobile USA service has been made. As we are committed to providing you with great service, we will transfer your account to our sister brand Boost Mobile.

While I’m unsure exactly what’s going on, I expect there’s an effort underway to consolidate Sprint’s flanker brands in advance of news about whether a merger between Sprint and T-Mobile will go through.

Boost’s “Super Reliable, Super Fast” Network

Boost Mobile is running a new commercial that features Pitbull and pitches the company’s low prices. Towards the end of the ad, a narrator says that Boost has a “super fast, super reliable network.” The narration is accompanied by this image:



In most commercials that involve carriers making claims about service quality, carriers will use fine print to cite research that backs up their claims. The Boost ad doesn’t include a citation; perhaps that’s because Boost’s claim doesn’t have much substance. “Super fast, super reliable” is super vague. Boost’s service probably is super fast compared to wireless service from 15 years ago. On the other hand, Boost’s service is not super fast compared to most services currently offered by other U.S. carriers.

Boost runs over Sprint’s network. There are a lot of different companies that evaluate network performance, and Sprint tends to do poorly relative to its competitors in the rigorous evaluations. Sprint had the lowest speeds among all four major networks in both RootMetrics’ and Opensignal’s most recent national assessments.

Boost’s claim looks even sillier in light of the fact that its subscribers tend to have low priority data access on Sprint’s network. When Sprint’s network is congested, Boost Mobile’s subscribers will tend to experience slower data speeds than those who subscribe directly to Sprint’s service.

A misleading image accompanies Boost’s misleading claims about quality. The image looks like a coverage map showing extensive coverage, but a disclaimer states: Coverage not available everywhere. Not a depiction of actual coverage.

Here’s the full commercial: