Smartphones and Data Plans

Moneybox
A blog about business and economics.
April 11 2012 4:46 PM

Smartphones and Data Plans

A couple of my smartphoneless friends (people in grad school, generally) wrote in to say that what's keeping them from getting smartphones isn't the cost of the phones but the cost of the data plans.

I think this is basically irrelevant to the point that very soon all phones will be smartphones. That's because at the low end of the market the data plan premium has already gone away. TracFone's existing smartphone hardware offerings are pretty meager, but their monthly plans all include Web browsing and email at no premium over voice-only plans. Cricket also has very cheap smartphone plans. Once workable smartphones are so cheap that it doesn't make sense for these vendors to offer anything nonsmart, it won't really make sense for the big players to try to maintain the data premium. Which isn't to say that all plans will magically become cheap. The lowest-level smartphone plans may be quite stingy with the data (sort of like existing international data roaming plans) such that low-income people try to avoid using data-intensive features unless they're on wifi. But it doesn't change the fact that essentially everyone will be carrying a computer around in their pocket as an incidental consequence of their desire to own a telephone.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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