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Cell Phone Fees Guide
Mobile phone plans covering call minutes, text, and data are always in flux, but one annoying part of the bill is more or less constant -- cell phone fees. Consumers can be certain that no matter the sticker price for a phone plan with a service contract, the final tally will be higher once fees are added in.
Some mobile phone charges are taxes, surcharges, and fees levied by the local, state, and national governments and thus unavoidable.
Related: Best smartphones for a penny or less
As many consumers know full well, interpreting a mobile phone bill is often an exercise in frustration. And comparing the fees and fine print for the four major carriers when it's time to choose among them is downright exasperating. To shed some light on these matters we researched the various fees for smartphone use that appear on monthly statements sent out by AT&T, Verizon Wireless, Sprint, and T-Mobile, which together claim more than 90 percent of U.S. subscribers, according to research firm Strategy Analytics.
Ultimately, we concluded that T-Mobile offers the most consumer-friendly policies, followed by AT&T, with Verizon Wireless and Sprint bringing up the rear. T-Mobile doesn't charge an upgrade fee for existing customers or an activation fee for a new line while the three other major carriers charge at least $30 for each action. Additionally, all T-Mobile plans include unlimited data, so there's no possibility of getting socked with overage fees for exceeding a data limit. By contrast, AT&T and Verizon Wireless charge $10 and $15 and up, respectively, for each extra gigabyte (GB) of data. Sprint charges 1.5 cents for each extra megabyte (MB) but also offers unlimited plans.
In a groundbreaking change in policy, T-Mobile has also eliminated international roaming fees as of Oct. 20, 2013. Standard post-paid plans automatically include unlimited data and texting, as well as calling rates of 20 cents per minute from outside the U.S. The data speed is slow -- about 2G -- so the company offers high-speed data passes for $15-50 depending on the amount of data and the number of days of access needed. By contrast, the other carriers charge high roaming rates for calls, messaging, and data during travel outside the U.S. and sell pricey international data packages to reduce the rates. For instance, AT&T levies up to $20 per MB of international data roaming. That can be alleviated by data packs starting at $30 for 120MB, cheaper than the Sprint deals and about on par with the Verizon Wireless package. Lest there be any confusion about the value of these international data plans, know this: Uploading 25 pictures from an iPhone 5 abroad without a data package with AT&T, Sprint, or Verizon would cost approximately $750.
To get a handle on the array of extra charges, we organized the cell phone fees into three broad categories: carrier-imposed fees that can be avoided or lessened by switching carriers or plans, usage-related fees that can be avoided by changing usage patterns, and fees that represent taxes and surcharges and remain (almost) the same regardless of carrier. Details for the four major carriers are provided in the accompanying charts. Our research skipped over plan particulars, but it's worth remembering that many fees, such as overage charges for minutes or text messages, depend on the carrier and the specific plan.
We found that the highest cell phone charges attach to international calling and data usage and can be mitigated with a little forethought. Customers who need to call other countries while residing within the U.S. can arrange for service additions costing up to $10 a month (depending on carrier) that reduce calling rates to select countries. Cell phone fees while traveling abroad likewise can be trimmed by buying an international plan, although it's imperative to keep an eye on data usage, which is costly in foreign locales.
We also discovered mobile phone charges that may be tacked onto monthly statements but aren't assessed by the carrier or by any government. Referred to as cramming, these charges reflect services (often useless) that consumers are pressed into accepting by third parties and did not authorize or receive, or whose true cost has been obscured. Such charges may appear on bills with uninformative labels, such as "membership fee," in the hope that customers won't notice.
Bottom line: When it comes to cell phone fees, it pays to be an informed consumer.
Best Cell Phone Fees
T-Mobile is the oddball carrier in terms of plans and fees. The provider shook things up by ending the two-year contract model and continues to innovate with new offerings for consumers. In terms of fees, it wins the "best" mantle for relatively low, and sometimes nonexistent, extra costs. Unlimited data and texting is also included for customers traveling within more than 100 countries.Read Full Review and Compare Prices »
Good Cell Phone Fees
AT&T imposes several fees that annoy customers but are generally lower than or equal to those at Verizon and Sprint. AT&T is a good option for international travelers, as GSM phones work well overseas and international talk, text, and data packages are reasonably priced.Read Full Review and Compare Prices »
High early termination, activation, and upgrade fees hurt Sprint's standing, although the carrier gets credit for data overage charges assessed by megabyte rather than gigabyte. Sprint's newest plans also include an option for unlimited data, minutes, and texting for the life of the line, which eliminates overage fees.Read more »
Verizon Wireless Fees
In terms of fees, Verizon does little to win over consumers. Activation and upgrade fees are about the same as other carriers', but data overage costs are higher. International travelers may be limited by Verizon's use of CDMA technology, although rates are competitive.Read more »
Verizon Wireless Fees Review
AT&T Fees Review
T-Mobile Fees Review
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