Google’s (NASDAQ: GOOG) unveiling of its “Project Fi” MVNO yesterday was expected, not surprising and somewhat underwhelming. I’ve expressed my skepticism about this proposition before, and now that we have the details I think it’s safe to say that Project Fi will not be a “game changing” move in the wireless industry for a variety of reasons, including its pricing, scope and experimental nature.
However, it could eventually push the wireless industry in a new direction and spur carriers to provide faster service and introduce more consumer-friendly offerings, which I think would be a net positive for customers and the wider industry.
Let’s start with the brass tacks of the Project Fi offering. For $20 per month plus taxes and fees, the service offers access to around 1 million U.S. Wi-Fi hotspots and unlimited domestic voice and texting, as well as unlimited international texting and low-cost international calling in more than 120 countries. Then, customers pay $10 per GB of data on top of that. Importantly, at the end of the month, Google will credit users for their unused data, so that users only pay for what they use.
Project Fi is marginally cheaper for individual users than what the Tier 1 carriers offer. However, when compared to family plans with shared data, Project Fi does not stack up so well. BTIG analyst Walter Piecyk notes in a blog post that for a family with three smartphone lines using 6 GB of shared data, Project Fi is only cheaper than AT&T’s plan ($120 on Project Fi compared to $145 on AT&T). Piecyk found that plans from Verizon Wireless and Sprint at that tier are $5 cheaper than Project Fi, and T-Mobile US is $10 cheaper. (Read Full Article)