By Tech Powered Dad | November 4, 2013
UPDATE: Here’s my review of the Nexus 5 for MVNO’s.
A couple of years ago, I did a post about teacher discounts on cell phone plans. Given the way most cell phone contracts work here in America, that means I’m almost up for renewal. Since I’m both a penny pincher and a gadget lover, I’ve spent way too much time over the last 6 months trying to decide how I could get the best device on the best plan at the best price.
To briefly recap, two years ago, I went with T-Mobile. They offered competitive prices, a 15% discount for teachers (Illinois state employees), and fast 4G HSPA service in my area. However, time time around, I’ve finally decided to sacrifice my teacher discount. As competitive as T-Mobile’s prices were, I’m convinced that the new Nexus 5 will allow me to improve on the quality of my device, my coverage, and the price over any smartphone I’ve ever used.
Cost
When I started running the numbers on buying a Nexus 5, it didn’t look like they’d add up. It’s a $350 phone off contract, significantly cheaper than current top of the line phones such as the iPhone 5S and Samsung Note 3 cost off contract, but much more than those phones cost after a carrier discount for signing a 2-year contract. However, I hadn’t factored in MVNO’s (Mobile Virtual Network Operators). These “pre-paid” cell phone providers such as Virgin Mobile and Straight Talk piggy back their service off the networks of the big 4 providers: Sprint, T-Mobile, AT&T, and Verizon. They then provide no-contract plans at significantly reduced cost over what the big 4 charge. The catch? You have to pay full price for your phone, a perfect match for the Nexus 5.
MVNO plans are so much cheaper that if you can find a reasonably affordable phone, like the Nexus 5, you’re better off, even when factoring in a teacher/state employee discount. It’s tough to do an apples to apples comparison, but here are the numbers for AT&T vs. Straight Talk (an MVNO that offers the AT&T 4G LTE network). The last I heard, AT&T was offering state of Illinois employees (including teachers) a 15% discount. Your state may be different.
AT&T
$3060 Cost of an unlimited talk and text, 4 GB shared plan for 2 lines for 2 years ($150 per month according to AT&T planner, $127.50 if you qualify for a 15% discount).
$300 Up front cost for two LG G2 smartphones (the phone on which Nexus 5 is based since AT&T hasn’t announced their Nexus 5 pricing yet.).
Total for 2 years, $3360.
Straight Talk
$2160 Cost of an unlimited talk and text, 5 GB shared plan for 2 lines for 2 years ($90 per month).
$700 Total cost for two Nexus 5 smartphones.
Total for 2 years, $2860.
You don’t have to be a math major to realize that’s a savings of $500.
Freedom
Owning a Nexus 5 also means I have freedom. What if Straight Talk raises their rates? What if I take a job in a different city and their AT&T network service is weak there? Since I own the phone outright, and I’m not on contract with Straight Talk, that’s no problem. I can change providers at any time with no penalty. Just pop in a relatively inexpensive SIM card, and I’m on my way to a different network. Since the Nexus 5 works on any US carrier but Verizon, I can go with any MVNO that doesn’t piggyback off Verizon’s network, or use a pre-paid plan from any of the other members of the big 4. That’s a far cry from where I’ve been for the last 2 years, chained to T-Mobile.
When it comes to an “upgrade plan,” there isn’t one. However, if you are the kind of person that wants to upgrade annually, check out the resale market for smartphones on eBay. You may be surprised to see how much you can get for your one year old phone on eBay that can go towards the purchase of your new phone. Heck, used Nexus 4’s are still going for over $200 on eBay right now. If the trend holds with the Nexus 5, I can sell mine a year from now and be more than halfway towards the purchase of Google’s next-gen phone.
Technology
I’m not going to get into details of the Nexus 5 hardware. In some areas such as the display and processor, it’s considered to be among the best on the market. In others, such as battery and camera, some expert reviewers are describing it as a step behind top phones like the Samsung Galaxy Note 3 and iPhone 5S.
Considering it costs half of what the most flagship phones cost off contract, I don’t expect the Nexus 5 to be tops in every category, as long as it’s competitive with those top phones (and I don’t know of anyone disputing that). There are a couple of aspects to the Nexus program that make it almost irresistible to gadget lovers.
First, you get the “pure Android” experience. That means that the Nexus 5 ships with Android exactly as Google created it. There are no OEM skins like Samsung’s Touchwiz or HTC’s Sense with extra visual and app elements I’m not interested in. Even better, there’s none of the uninstallable carrier bloatware apps that the big 4 just can’t seem to resist bogging down our phones with.
The other aspect that I love about the Nexus program is that you get Android updates from Google almost as soon as they are announced. There’s no waiting months for your phone manufacturer to update your phone, crossing your fingers and hoping that they’ll give you an update. Google pushes the updates to Nexus phones out within a couple of weeks. Unless you have a Nexus device, software updates are one place that Apple’s iOS definitely beats Android.
Is Nexus for Everyone?
No, it’s not. There is a significant up front cost the first time you invest in a Nexus device, especially if you don’t have another smartphone to sell back. Although the long term savings are definitely there, some people would rather pay more on a month to month basis than more up front. You’re also probably not going to get as much customer support from an MVNO as from a traditional carrier, seeing as how most of them don’t have physical stores. And if you must be on Verizon’s network, you are out of luck, supposedly due to the relationship between Google and Verizon souring a couple of Nexus generations ago over their collaboration on the Galaxy Nexus.
However, if you are looking to break free from the carriers and their contracts, it’s hard to imagine a better way to do that than the Nexus program. The Nexus 5 is the most exciting way Google has provided to do that yet.
As of the writing of this article, the Nexus 5 is currently sold out. Click here to see if Amazon has the Nexus 5 back in stock.