The cellular industry in the U.S. is currently dominated by a handful of national and regional carriers as described in Chapter 3. National Carriers are typically major corporations who offer service in most areas of the nation, while Regional Carriers target certain geographical areas within the U.S. We recommend reviewing the benefits and disadvantages of each national or regional carrier to find one that best suits your needs.
What to Expect from the Carrier
The carrier is responsible for providing you with your initial phone purchase and cellular service based on the rate plan of your choosing. In return, almost every carrier will expect you as the customer to commit to a 1 or 2 year contract agreeing to pay for the service until the term expires. Pre-paid services are also available from many carriers, although you’ll pay much more for the phone and service than you would with a monthly service plan.
National Carriers
(Better if you plan on moving, more likely to have service everywhere)
Regional Carriers
(Service is more targeted to individuals living in certain regions of the country)
Contracts & Termination fees
The money guaranteed to the carrier by your yearly contract commitment allows them to sell you your first phone for less than if you purchased it without service. The only way to avoid committing to a contract is to sign-up for a pre-paid/no-contract service. As stated above, many carriers offer such services but they'll wind up costing you significantly more per minute than monthly service.
Activation Fees
Every major carrier charges an initial fee to activate a new account. The average activation fee is $35 per line, but it can vary by carrier. Activation fees are often waived during special promotions, although these promotions are becoming increasingly rare.
Credit Requirements
All carriers will require credit verification for the main account holder on post-paid plans. You can expect to submit your Social Security number during registration before the carrier will approve your service. Every carrier has its own credit score requirement policy, which is not published. Customers who fail the initial credit check may be asked to pay a deposit or may be denied outright. Consumers who do not qualify for service should look into the purchase of a pre-paid plan or phone.
Taxes and Fees
Similar to traditional home phone service, you can expect to pay additional taxes and governmental fees with all cellular plans. The various taxes and fees are listed below, but for simplicity's sake expect to add approximately 17-28% to your plan price for these fees. “Taxes” are based on a percentage, while “fees” are a fixed based on local, state, and FCC regulations. The lower priced plans ($19-$35) will incur a higher overall percentage of taxes and fees, while more expensive plans ($69 and up) will incur a lesser overall percentage.
Keeping your current phone number
In most cases you can keep your existing cellular number and sometimes even transfer your home number to your cell phone. As long as your existing number is listed in your name, then the transfer is likely to be swift and easy. If the existing number is in someone else’s name, then you’ll need to first contact your existing phone company and transfer service into your name before your number can be transferred.
Reliability and Signal Coverage
While cellular service continues to improve, you should not expect cellular service to be as clear or reliable as traditional phone service. In most areas, cellular service is certainly more than satisfactory for the average user. However; cell service will not work everywhere and is susceptible to signal loss in some homes, buildings, and rural areas where cellular towers aren’t located. Keep in mind that cellular carriers do not guarantee service to work everywhere within their coverage area, although most people are willing to give up some quality for the flexibility that cellular service offers.
