Project Fi's winners and losers

Winners: frequent international travelers; losers: small wireless companies

Google Project Fi

Project Fi, Google's Wi-Fi and cellular network service announced Wednesday, can variously be described as low-cost, disruptive, cutting edge, tantalizing, confusing, even awesome.

Google is offering the lowest entry-level wireless price plan in the U.S. at $30 a month. That sum includes $20 for talk, text, Wi-Fi tethering and international coverage in 120 countries plus $10 for 1 GB of data. The plan adds $10 a month for each additional 1 GB of data thereafter. Google is partnering with Sprint and T-Mobile for the cellular service.

One big drawback is that the service, so far, is described as a "project" that is invitation-only for select users who join an Early Access Program. The plan also requires a Nexus 6 smartphone, which went on sale in October for $649. Those invited also must live in a zip code where Project Fi has coverage.

To be sure, there are potential plums with Project Fi. The biggest winners, according to analysts, will be entry-level smartphone users, frequent international business travelers and anyone who loves technology innovation and disruption, and in the wireless industry in particular.

There could be downsides as well. Users could face gaps in wireless coverage or less-than-smooth handoffs between Wi-Fi and the cellular networks of either Sprint or T-Mobile. Google customer service could be shoddy. Small wireless companies could be threatened. Google could ultimately decide to back off Project Fi, similar to what's happened with Google Glass.

Here's a rundown of winners and potential losers.

Winner: Entry-level, low-data smartphone users

The biggest pricing advantage with Project Fi goes to single individuals who are light users of data. The plan will likely be $15 to $20 cheaper than many competing offers from major carriers. (Computerworld blogger JR Raphael shows price advantages for Project Fi in 10 different comparisons with some of the major U.S. carriers' plans.)

Average data consumption in the U.S. is 2 GB to 2.5 GB per month. "The moment you use more than 4 GB of data, you are better off at Sprint, and if you use more than 5 GB per month, you are better off being on T-Mobile," said Roger Entner, an analyst at Recon Analytics.

Bill Menezes, an analyst at Gartner, agreed. "This plan is clearly aimed at lower-usage customers who are paying greater than $10 per gigabyte for what they use," he said.

Using Entner's analysis, 4 GB on Project Fi would cost $40, plus the $20 monthly fee for voice and other services, for a total of $60. Sprint offers an unlimited data plan for $60 a month that includes talk, text and data. With the iPhone 6 or 6 Plus, the price drops to $50 a month.

For 5GB of data on Project Fi with talk and text, the total would be $70, which is a tie with what T-Mobile offers for talk, text and 5 GB. But T-Mobile also has an unlimited plan for talk, text and data at $80 a month.

What's interesting about Project Fi is that both the cellular carriers working with Google have unlimited plans, while Project Fi does not. "It's very interesting that Project Fi is not unlimited, which is Google's tacit admission that no matter how much the public wants it, bandwidth costs money," Entner said.

Menezes used his own experience as a T-Mobile customer to note that he and his wife have two unlimited voice, data and text lines for $100 a month. In a recent month, he paid his half-- $50-- for use of 4 GB of data and unlimited voice and text, which would have compared to $60 on Project Fi.

He also noted that volume discounts for data on both AT&T and Verizon can drop to below $10 per gigabyte. (Example: Two smartphones on the AT&T Mobile Share Value plan with 10 GB of shared data is $130 a month, while Project Fi would cost $140 a month.)

Winner: Frequent international travelers

Some of the major U.S. carriers can't compete with Project Fi on international wireless voice and data services.

Google's plan offers international coverage in 120 countries, and it's included in the same $10 per GB of data users pay for service in the U.S. Data speeds, however, are limited to 256 Kbps, which is considerably slower than the 10 times faster (or more) LTE data speeds seen in the U.S.

For international calls, the cost is 20 cents per minute, which is considerably less than prices of as much as $1 per minute on many carriers. Texts are unlimited within the $20 per month rate, according to Google's FAQ.

Google has set up roaming arrangements with carriers in all 120 countries, For other countries, users will need a SIM card that works with a specific carrier. For the international business traveler who visits 10 to 20 countries on Google's list, "this is a very, very good plan," Entner said.

T-Mobile also offers competitive international roaming, although data speeds are somewhat slower than what Google is offering, Entner said.

Small businesses with up to five workers, whether in the U.S. or traveling internationally, might benefit as well with Project Fi, especially if each user is using less than 4 GB of data per month, Entner said.

Menezes said that Google has essentially created a flat-rate structure for international usage, which could eventually push AT&T and Verizon to do the same.

Technology innovation

Google also described new technology for Project Fi that will allow users to move seamlessly from 1 million high-quality Wi-Fi zones to LTE cellular from Sprint and T-Mobile.

With the help of a special new SIM card in the Nexus 6, users are supposed to get access to the highest-quality connection on the fastest network, whether Wi-Fi or one of the LTE networks. Phones can access the better of the two LTE networks in any given location, according to Google's description.

"If you're on one network and we detect our other 4G LTE network partner has a stronger signal, you're moved over to the other network to get the fastest available speed," Google's website says.

While roaming between network providers has gone on for years, it is unique that Google, as a new MVNO (Mobile Virtual Network Operator), is able to do so. Menezes said the shared cellular network feature "could be the most revolutionary part of Project Fi."

Entner said it's likely that voice calls on cellular would still be carried via older GSM on T-Mobile and then connect to a different voice technology, CDMA, on Sprint. However, T-Mobile now has Voice over LTE in place, and other carriers are moving toward VoLTE. Google's description of Project Fi on its website refers to using LTE with both carriers, with no mention of GSM or CDMA for voice. Google couldn't be reached to clarify whether those older technologies will be used.

In any event, the claims that these various mobile connections will be automatic for Project Fi users remains to be seen. "Quality of service will need to be good," said Carolina Milanesi, chief of research at Kantar WorldPanel. "The moment you are trying to figure out why you have no coverage is the moment you give up."

1 2 Page 1
Page 1 of 2
It’s time to break the ChatGPT habit
Shop Tech Products at Amazon