Republic Wireless announced that it will refund all unused cellular data for its customers. The announcement appeared to be a response to Google's recent launch of Project Fi, which allows its customers to purchase a certain amount of data measured in gigabytes, but unused data will be refunded in increments of 100 MB.
Republic Wireless is a mobile virtual network operator (MVNO), which started out in 2011 by focusing on cheap data plans that included Wi-Fi calling. The company's service is based on Sprint's network. When its customers are out of range of a Wi-Fi hotspot, their phones will fall back to using Sprint's network for voice and data.
Up until now, Republic Wireless' customers would pay a fixed amount for their data plans, and if they didn't use all of it, they wouldn't get any refunds.
Republic Wireless will take Google's idea a little further by completely refunding any unused data from their customers' plans. The company thinks that this move should also impact the two biggest carriers in the U.S., which it believes have long made excessive profits by charging their customers for data they didn't use.
“The cellular industry, largely dominated by two giant companies, has done a brilliant job convincing people that they need huge buckets of cellular data. The truth is that most people are within range of Wi-Fi the majority of their day and therefore never use all the data the carrier made them buy. The industry profits wildly from this practice – an estimated $52 billion annually, and we are determined to change that," said David Morken, co-founder and CEO of Republic Wireless.
Republic Wireless' plans (opens in new tab) seem to be slightly ahead of Google's Project Fi plans, at least at the lower-end, at up to $25 a month.
$5 -- unlimited Wi-Fi calling, texting and data (same)$10 -- "Base Plan" -- unlimited Wi-Fi calling, texting and data + unlimited cellular calling and texting$17.50 -- unlimited Wi-Fi calling, texting and data + unlimited cell talk and text, 0.5 GB on-net cell data$25 -- unlimited Wi-Fi calling, texting and data + unlimited cell talk and text, 1 GB 4G on-net cell data$40 -- unlimited Wi-Fi calling, texting and data + unlimited cell talk and text, 2 GB 4G on-net cell dataAdditional cell data -- pay as you go for $15/GB
Their plans are more or less equal at the $40 per month level, where both companies offer unlimited talk, unlimited text and 2 GB of data. Beyond that, Google's Project Fi wins by selling each extra 1 GB of data for $10 per month, while Republic Wireless will sell an extra 1 GB of data for $15 per month. In other words, if you don't need more than 2 GB of data per month, you may be better off using Republic Wireless.
However, there are some other angles to consider. Republic Wireless relies on Sprint's network alone, while Project Fi works on top of both Sprint's and T-Mobile's networks. Google also does more seamless transition between a national network of Wi-Fi hotspots and 4G connectivity.
On the other hand, only the $500 Nexus 6 works with Project Fi right now, and you still need an invite to use it. Republic Wireless is now offering the cheaper Moto G 1st gen and a Moto X 2nd gen (opens in new tab) for $150 and $300, respectively, and its service is already open to everyone.
The more interesting point both Google and Republic Wireless seem to make is that Verizon and AT&T haven't yet come out with their own Wi-Fi-based data plans, where customers can use as much data as they want and only pay for the 3G/4G data they use.
Considering how much money the two companies make from their current data plan paradigms, it's no surprise that they aren't in a hurry to adopt the same strategy, though. However, if Republic Wireless' plans and Google's Project Fi become more popular, Verizon and AT&T might have to respond with their own similar plans, too.