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How to ditch your voice contract: Part 2

Yesterday I talked about reasons for ditching your voice contract. Today, I'm going to explain how I did it, and saved some money and headaches into the bargain.

My incumbent cellphone carrier admitted that it overcharged me by hundreds of dollars, and put the onus on me to call back in repeatedly to fix the problem. It had me on the phone literally for hours resolving these issues. It bombarded me with sales text messages and annoying survey telephone calls, and I'd had enough.

My goal was to lower my mobile phone costs, and to minimize my dealings with the company as much as possible.  But as a writer that runs several businesses, I have some significant challenges. I had a personal phone number with Rogers, and three phone numbers, all with different Internet telephony service providers, including Skype. Overall, my entire bill for these different numbers came to around $190 per month. Not only do I need to take and make calls from various phone numbers, often while on the move. but sometimes, I need to record those calls (with the caller's consent, of course). And I want to do it all for a low price, with Canadian phone numbers (Skype's SkypeIn service, which lets you use a phone number with your Skype software, doesn't offer Canadian numbers. It's also extremely difficult to do with Google Talk's service).

When you sign up with a mobile phone provider, you generally get a voice plan for your phone calls, and maybe a data plan for web surfing, email, and Facebook. As we've discussed, the charges for the voice plan can be variable - especially if the carrier messes up and overbills you. What many people don't realize is that a suitable data plan can carry voice calls too.

Voice over IP (VoIP) turns your voice signal into data, and sends it via the same network technology that is used to send data over the Internet. If you've ever spoken to someone over Skype, you've already used a form of Voice over IP.

Many VoIP providers now offer something called SIP, which is a standard way of connecting voice calls. The great thing about using SIP to make VoIP calls is that it can also connect with telephone numbers. This means that you can use SIP to phone people who have regular landline or cellphone lines.

To do this, you need three things: a SIP service provider (think of it as a phone company for Internet-based calls), a device with a good, fast Internet connection, and a piece of software called a SIP client that acts like a regular phone. You can then make calls without having a conventional cellphone voice contract or landline.

I wanted to use a SIP client on my cellphone instead of using the regular phone interface to make calls. To do this, I needed a decent data plan, because I wanted to make and take calls when I was out and about, rather than just when I was on an Internet connection via a WiFi network.

3G data plans aren't always good enough for SIP calls; I tried on my old 3G iPhone 4. They can work sometimes, but the bandwidth is often relatively low, and the latency (the lag between your data reaching the other end of the link and it coming back again) is too high. This means that while calls over 3G can sometimes work, they can often get garbled and sound terrible.

What you need instead is an LTE-enabled phone. LTE is a far faster cellular network, with higher bandwidth and lower latency, and it's available across large parts of Canada on the incumbent carriers. Not all handsets support LTE. The iPhone 4 doesn't, for example, but the iPhone 5 does. but the iPhone 5 is a boring little slab of locked-down mediocrity, so I opted for the Samsung Galaxy S3 instead.

I didn't want a voice contract; I only wanted a data plan. This left me with two options: either buy an unlocked version of the phone separately and then buy the data SIM from the phone carrier, or buy the phone from the mobile carrier, along with the contract.

Buying a data-only contract for your own unlocked phone is tricker than it sounds. Carriers generally only sell data-only contracts for tablet devices, rather than phones. Most of the time, when I called a mobile carrier to ask about buying a data-only tablet contract and using it with a phone, the response was a kind of confused mumble. More than once, I was told that the data-only SIM was programmed not to work in a phone, and would recognise that it wasn't in a tablet device.

I wanted to be absolutely sure that the data-only plan would work with the phone, so I decided to buy them both from the phone carrier's store. I tried Bell, Telus, and Rogers, and only Rogers would sell me a month-to-month data contract (designed for a tablet device) with a Samsung Galaxy S3. Even this was a struggle. The salesperson looked at me askance when I asked, and had to check with her manager, who gave a disinterest shrug and nodded.

If I wanted this, I had to buy the phone outright. I had some savings, and needed a new phone anyway, so I took the plunge.

I took the trouble to do the math before I went to the store, to be sure that this was financially sensible. Even for a tech-head like me, who replaces my phone about every two years, it is.

Paying $190 per month for two years to maintain my existing voice contract and Skype subscription would cost me $4560.

Conversely, buying the phone and switching to a data-only contract would leave me with a $50 month-to-month data contract and around $30 per month in Internet telephony charges. In truth, my monthly Internet phone service costs are panning out far lower than this, but it gives me a ceiling for any unexpected costs.

This pessimistic cost estimate for a VoIP-based voice service on a smartphone still only comes to $80 per month, or $1920 over two years. Adding in the cost of the phone, the activation fee for the data plan, and the $200 it cost me to buy myself out of my contract brings it to $2950 - less than two thirds of the cost of the existing contract.

In addition to the cost savings, this carries significant advantages. I am not beholden to my cellular provider for anything other than the data plan. This makes the contract - and the bill - simple, and makes it difficult for me to be overcharged without noticing. The contract is also month-to-month. I don't have to pay to get out of it. 

Moreover, under my new plan, I get to buy a new phone, now. The cost of staying on my voice contract leaves me locked into Rogers' upgrade schedule, which might still see me paying some money for a new phone in any case.

So, I went with a totally data-based, VoIP solution using an S3 handset. I've now been doing this for well over a month. Want to hear exactly what software and provider I used, what niggles I experienced, my approach to solving them, and how it all turned out? Check back on Monday for another post about my experiences.

How to ditch your voice contract: Part 1

How to ditch your voice contract: The Payoff

Danny Bradbury, MSN Tech & Gadgets



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Danny BradburyDanny Bradbury

Danny Bradbury is a technology journalist with 20 years' experience. He writes regularly for publications including the Guardian, the Financial Times, the Financial Post, and Backbone magazine. Danny also writes and directs documentaries.

Maurice CachoMaurice Cacho

Maurice Cacho is a Toronto-based journalist mixing his love for tech with a passion for news. He's also CP24's Web Journalist and appears daily on CP24 Breakfast and weekly on the channel's tech show, Webnation, discussing tech news and trends.