Monday, January 26, 2009

SafeLink Wireless: When "Free" Isn't A Great Deal

Update: SafeLink now has a competitor, and they're offering a better deal. See our post about Assurance Wireless.

Running the numbers on the SafeLink Wireless offer for qualifying low-income people, it turns out that this program is a truly good deal if you only use the free minutes and don't buy any additional minutes through the SafeLink (TracFone) retail channel. If you plan to talk beyond the minutes offered for free, and you don't include cost of the inexpensive phones you get through this program, you can find cheaper service elsewhere. Here's the analysis:

In most states where SafeLink is offered, you get a free phone and 68 minutes of free talk time a month (80 in Massachusetts). So far so good. Free is great. If you only use these free 68 minutes a month, there is no cheaper program (unless someone knows of a company that pays you to use a mobile?).

If, however, you plan to talk even one more minute beyond these 68, the resulting per-minute cost is higher than you pay with other providers. SafeLink Wireless is part of TracFone, and from the SafeLink web site, when you purchase additional minutes beyond the free ones, you buy a TracFone card. The cheapest TracFone card right buys 60 minutes for $20, or $.33/minute.
  • 68 free minutes + 60 paid minutes = 128 minutes
  • Total Cost paid (additional minutes) = $20
  • 128 minutes / $20 = ~$.16/minute
$.16/minute isn't exactly the lowest price in the prepaid mobile world. Virgin Mobile's lowest-cost minute card gets you 200 minutes for $20 ($.10/minute), and if you buy in higher denominations, you get an even cheaper per-minute rate. Net10, which is another TracFone-owned company, charges a flat rate of $.10/minute for all their card denominations. So, on a per-minute basis, the SafeLink Wireless deal is not the best for lower-income people who plan to use more than the free minutes provided.

There are two main caveats to this. First, SafeLink provides a free phone along with the minutes. I made a call to SafeLink last week, and was told that the phones available through this program are the Motorola W175 and C139 models. Both phones were available on the TracFone web site last week for $9.99. So, while a free phone is great, it's only a savings of $10 or so. This gets eaten up pretty quickly by the $.16/minute rate. Second (and more importantly), the additional (TracFone) minutes you add to the SafeLink phone don't expire for 90 days, vs. 30 days for Net10 minutes. In other words, you get to keep you minutes for 60 days longer, which is a good thing for people who don't always have funds to actively replenish their phones.

There are other reasons why the SafeLink Wireless program may not work for many low-income people. The biggest is the requirement that you have a home mailing address, and only one person at that address can receive the subsidy. If you're living in a shelter, a group home, your car, or on the streets, you can't take advantage of this even if you otherwise qualify. Sounds like the FCC made SafeLink adopt the policies of the LifeLine program, which was designed with landlines in mind. Hopefully, that will change.

Community Voice Mail clients and others who are thinking about this program should think hard about how many minutes they plan to use each month. More than 68? Look at the alternatives.

(I've been trying to talk with someone at SafeLink Wireless and TracFone for months, but am finding their web site and customer service processes almost impenetrable. If anyone from TracFone would like to refute this analysis, I'm all ears!).

Wednesday, January 14, 2009

SafeLink Wireless: Available in Georgia

Update: SafeLink now has a competitor, and they're offering a better deal. See our post about Assurance Wireless.

SafeLink Wireless is now available to people who qualify for the federal Lifeline program in Georgia. As I've mentioned before, this is a free mobile phone and 68 free minutes/month for lower-income people who qualify. If you live in Georgia, read the FAQ for specific eligibility requirements and decide if this is a program for you.

(In a few days, I'll post an analysis about whether this is actually a good deal for CVM clients and other low-income people. Initial analysis indicates it's only a good financial deal if you never use more than the free minutes provided in the program. If you buy any more minutes, the cost/minute is more expensive than other carriers).

Monday, January 5, 2009

New CVM Blogs: Tulsa and Summit County (OH)

I'm pleased to announce two new Community Voice Mail blogs:
Both have great information about local resources and events of interest to CVM clients, social service agencies, and anyone in crisis or transition seeking to improve their lives.